20 February 2023

SA Businesses need to take heed against greenwashing away their futures!

Submitted by: Bronwyn
SA Businesses need to take heed against greenwashing away their futures!

Chris Blair, CEO of 21st Century, shared his insights at the ITWeb Governance, Risk and Compliance Conference held last week. Blair unpacked the recently released Global Governance and Executive Compensation Group (GECN) report, which contained some startling revelations for the future of business in South Africa.

Backed by the report, Blair illustrated how pre-pandemic companies were most concerned with shareholder returns and financial enrichment, but how the picture had changed dramatically and with good reason three years later. He also addressed the trends in the Global Environmental, Social and Governance field and analysed concerns, trends and challenges that companies will face as they move from being principally shareholder concerned to stakeholder concerned and the "balance between people, planet and profit" (the 3 Ps).

The GECN study (of which 21st Century represents Africa) that Blair referenced was conducted over five continents and was a comprehensive study of ESG across the major corporations in each of those countries.

Blair revealed how, around the world, 72% of companies now factored in "social concerns" among their non-financial ESG measures, and how 50% actively factor in environmental concerns, with 37% and 34% factoring in customer and governance measures respectively. More importantly, he showed how these are increasing. Of the social measures, "Diversity, Equity and Inclusion" showed massive growth, with Blair saying, "it's entered into boardrooms in a big way".

Unpacking the study, Blair revealed how in the short term, these ESG measures are playing off against total Shareholder returns.

"The more ESG measures your company has got, the worse your total shareholder returns, but this is only in the short term," said Blair. "This makes sense. Investing in ESG things, like climate, your people, or on social conditions, for the future costs money, and you have to get the money from somewhere. So where do you get it from? The return to your shareholders."

But as Blair explained, "this is the long game, and ultimately for those companies that prepare and invest, the wheel will turn."

According to Blair, companies that invest in ESG now are positioning themselves for a future where investors and shareholders are increasingly concerned about ESG goal success and project viability, and investment will depend on ESG measures being in place. He therefore recommends that the reward fraternity begin building in greater reward strategy for executives who achieve those ESG goals.

This is bad news for a high percentage of companies in South Africa, who are not transforming, but who are rather greenwashing figures to claim more significant ESG benefits than they truly have. Blair explained how the study found that only 8% (STI) and 14% (LTI) of companies around the world disclose targets upfront (ex-ante). This means that many companies only report what they actually achieved and not what they hoped to achieve, thereby greenwashing their results.

The ITWeb Governance, Risk and Compliance 2023 Conference looked at re-imagined businesses and how they can manage new risks through business resilience and agility. The line-up of global experts shared their insights into new opportunities, combating risk and enhanced compliance strategies.

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About 21st Century:

21st Century, a level 2 BBBEE company, is one of the largest Remuneration, Reward, HR, Organisation Development and Change Management consultancies in Africa, specialising in sustainable business solutions, with a team of more than 60 skilled specialists, servicing over 1700 clients – including non-profit organisations, unlisted companies, government, parastatals and over two-thirds of the companies listed on the JSE. 21st Century offers bespoke business and strategy planning services, operating model and organisational design, creative reward practice modelling, change, stakeholder and culture management, training courses and comprehensive human capital and talent plans. These are all underpinned by our analytic and survey capability tailored to the African environment. 21st Century continues to offer solutions via a combination of virtual channels and on-site presence. 

21st Century has expanded its services to offer a full turnkey sustainable business and remuneration service. Beyond remuneration and reward consulting, 21st Century offers local analytics for business advantage; remuneration and HR training; change management services; talent and people solutions; and end-to-end organisational design and development.

21st Century is the Africa representative for the GECN group of companies, specialists in global executive remuneration and governance.

Issued By: The Lime Envelope
On Behalf Of: 21st Century
For Media Information: Bronwyn Levy
Telephone: 076 078 1723
E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.