Why have companies with good ESG ratings outperformed in the recent crisis? That is a question many investors are asking now. And on Wednesday Tensie Whelan of NYU Stern Center for Sustainable Business had an interesting new answer to offer: supply chains.
Speaking with Paul Polman (head of Imagine), Chris Pinney (founder of High Meadows) and Alison Kay (of EY) in an FT digital dialogue on Wednesday, Ms Whelan pointed out that companies that had tried to conform to ESG norms in recent years often started with a close look at their global suppliers.
And while they previously did this for environmental or human rights reasons, this forensic exercise is now delivering an unexpected blessing: it makes companies more knowledgeable about how the Covid-19 crisis might hit these chains — and helps them be ready to pivot.