ESG MUST FOCUS ON STRATEGY

Sustainability of corporate success and the country's economic performance are closely linked

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MANY PEOPLE, including some policymakers, are skeptical about the imminence of ecological disasters and the threatened habitability of planet earth. President Trump’s administration has repealed the Inflation Reduction Act (IRA), abandoned Diversity, Inclusion, and Equity (DIE), and jilted information about a key metric: carbon dioxide concentration in the atmosphere.

The focus on ESG is being perceived as the hoopla of the activists. If they do not repudiate, they ignore the UN’s estimate of 4.5 degrees of warming by 2,100 with a business-as-usual scenario. In their book “Climate Shock”, Gernot Wagner and Martin Weitzman outline an 11% chance of overshooting six degrees. At that level of heat, the habitability of humans at the equator and in tropical areas will be a question mark. Many pundits estimate that the ice sheets will melt at two degrees, 400 million people will face water scarcity, and India will encounter thirty-two times as many extreme and prolonged heat waves.

Earth has experienced five mass extinctions in the past, each wiping out even the evolutionary fossil record. All but one was triggered by climate change, caused by greenhouse gases. The asteroid caused only one annihilation of earth, which killed the dinosaurs. Current trends do not obviate the possibility of another extinction. The effort of Elon Musk to colonise Mars for the survival of humanity may not be empty madness.