Leadership and resilience in a time of crisis
21 April 2020 - By Marjella Lecourt-Alma, CEO and Co-founder
We are in a time of crisis. How companies respond - the tools they use, the lessons they take, and the policies they implement - will deeply influence the future of business. Being a part of this conversation is incredibly important.
Datamaran CEO Marjella Lecourt-Alma kicks off our new podcast on digitalization and business with a look at the impact of COVID-19. Along the way, she discusses being authentic about ESG, how the digital transformation is continuing, and how ESG concerns have reached the boardroom and are influencing strategy definition.
“A crisis such as this…”
“Even as the crisis continues apace, there is room to look at what a post-COVID world might look like - and we can already see that the future of work is more digital, more innovative, and more connected than ever.” The new normal will likely include more remote (i.e. digital) working, fewer face-to-face interactions both inside and outside of the office, and most importantly a strong emphasis on understanding and combating ESG risk.
“More than just highlighting the need for companies to engage with their external risks,” says Marjella “this pandemic demonstrates the need to do so meaningfully. Stakeholders, including both investors and communities, are asking serious questions about how companies are positioned to weather the crisis. While these questions might be formulated differently on a stakeholder-by-stakeholder basis, they all get at the same basic point: who is taking ESG seriously?”
This question is key, as it shows clearly that companies need to rethink how they do business. “This crisis is showing very clearly who is helping and who is not. Even more, the crisis is highlighting the value of incorporating ESG risk analysis into their core practices. Doing so provides flexibility in dealing with both crisis moments and with the impacts those moments have on stakeholders. And businesses who are more agile in responding to the needs of all their stakeholders are better at weathering risk” - in other words, there’s no downside.
Being authentic is the new normal
“COVID-19 is hammering home just how quickly ESG issues can become immediately financially meaningful. Companies need to show stakeholders that they are being authentic about ESG, and are serious about integrating them into business strategies.” Failure to do so will bring uncomfortable questions from investors and others, not to mention a broader risk profile.
This sort of authenticity is representative of a dynamic approach to the materiality process. Such an approach brings home the idea that materiality isn’t just a once in a blue moon way to cover your bases. Rather, it’s an integrated mindset that places ESG at the heart of business decisions - in the boardroom and beyond.
The best way to achieve this mindset? “Actively build your own governance processes to tackle these issues.”
The digital transformation
A digital world is a more connected world, says Marjella. Even as traditional methods of stakeholder engagement have been disrupted, digital models and variants are taking their place. What this means for the flow of information is that velocity of data is even higher than before. As businesses focus on responding to the disruptions of COVID-19, they are seeing that “there is a premium on getting information as close to real-time as possible.”
COVID-19 has drastically accelerated the global digital transformation. This is for a simple reason: right now, digital business is the only game in town.
“Two things are clear. One, companies are working to understand their external risk landscape more than ever. And two, they are looking to achieve that understanding as quickly as they can. As a digitally-enabled company, we need to ramp up our efforts even fast to be able to accommodate this new way of working. The future of work is here.”
Datamaran has been working on integrating digital tools itself. “With employees scattered across 12 countries and 3 time zones, this is not just a conscious choice but also a necessity. Nevertheless, the coronavirus crisis has caused some major changes - for example, we now have in place a mandatory work from home policy. All in all, the goal of Datamaran is the goal of every company at the moment - to maintain continuity of business in a socially responsible manner.”
Coming full circle
As business continues on in its newly digitized way, reporting requirements (and expectations) also continue. Investors are asking tough questions that can only be answered by de-siloing ESG, and giving this functionality the digital tools it needs to analyze the external risk environment.
“In our community, ESG concerns are already influencing business decisions at all levels. Digitalization is a major enabler of this, especially combined with the pandemic, which has brought many functions together into the ‘COVID-19 war room’.”
“As disruptions related to the outbreak continue to wreak an economic - and human - toll, there has been an interesting response in the market. ESG-focused funds are outperforming the market significantly. It is clear that companies that put a high value on integrating ESG into their business process will be rewarded by the market.”
Technology has an increasingly important role in realizing this reward. The proper tools allow companies to proactively engage stakeholders and manage risk.
We ask you:
The world is changing… will you change with it?
Those that adapt will win.
Global Insights Report: The Three Big Wake-Up Calls For Boards
The events of 2020 brought risks related to public health, climate change, and diversity, equity, and inclusion to the forefront of public consciousness. Yet, too many businesses are failing to incorporate external and ESG risks into their long-term strategies and to think about business model innovations to reorient towards long-term value creation.
Published jointly by Datamaran and The Conference Board, this Global Insights Report examines how some of the largest public companies reacted to the events of 2020 in their corporate reporting. It considers how senior executives and Boards can apply this knowledge in addressing other systemic and external risks.
Get your complimentary copy now and learn how to use real-time data to monitor the external risks landscape and stay on top of trends.