19 Jun Sustainability: An “Influencers”-Based Strategy

Author: Joaquín Garralda, Dean of Academic Affairs

In this post, I would like to talk about Sustainability: An “Influencers”-Based Strategy (a fashionable word running by internet).

Who are the people that are going to “move” the companies beyond some philanthropy and greenwashing actions?

We usually hear Executives in the media refer to the topic that society “expects” “prosocial” behaviours from companies or even to “give back”, as I heard with dread the other day. And so, that the final consumer makes more and more decisions based on the companies’ RSC actions. I believe these comments are no more than empty words since we do not see these prosocial effects in the shops’ cash registers. Therefore, companies are waiting for these purchasing behaviours to become a reality and only then they will seriously consider the Sustainability issue.

On the other hand, from the point of view of many companies, it is the regulator the one who is “forcing them”  (RSC is not something volunteer anymore) to be more sustainable through additional rules, tags, etc. France is a good example of a very active Regulator in this issue.

Although these two “influencers” have their impact, I think that –from a quiet position– those who are really influencing big companies are the proper business owners.

The shareholders? Am I surprisingly going back to Milton Friedman? Yes, but with nuances.

The shareholders who can use their vote in the Shareholders’ General Meetings are the managers who make decisions for millions of savers who have entrusted their savings to them. Institutional investors (Investments funds, Pension funds, Insurance companies, Sovereign funds) are increasingly acting as companies’ owners and they are the ones who should have a long-term vision, because their “responsibilities” to their shareholders/policyholders are long-term as well.

And what is more long-term relevant than ESG issues?

Consequently, keeping track of the investors’ behaviours could help us evaluate the pace in which companies are “influenced” by Sustainability aspects. Because, if big companies move, unlisted companies  and SMEs will move as well.