Sustainable Sustainability Why ESG is Not Enough

Eighteenth-century economist Adam Smith propagated profit maximization as the incentive for businesses to create goods and services that society needs. He argued that free-market competition would ensure consumers get the best quality product at the cheapest price. Two hundered years later, Milton Friedman agreed in his seminal 1970 New York Times op-ed that the sole responsibility of business is to maximize profits ‘so long as it stays within the rules of the game’. Incentives coupled with some regulations were to henceforth safeguard societal interests. Instead, incentives created bad behaviour. Regulations were routinely bypassed with intelligent loopholes. Despite this—to encourage sustainability today—we are again using incentives and regulations. That’s predominantly what the ESG framework focuses on. And what do we see? Rampant greenwashing and box-ticking. To address today’s existential challenges, we need innovation of the highest order. Innovation can neither be legislated nor driven by extrinsic incentives alone.

Rajeev Peshawaria is the Chief Executive Officer (CEO) of Stewardship Asia Centre (SAC) in Singapore and Founder President of the Leadership Energy Consulting (LEC) Company in Seattle.

Author of the Wall Street Journal and Amazon bestseller Open Source Leadership (McGraw Hill), Too Many Bosses, Too Few Leaders (Simon & Schuster), co-author of Be the Change (McGraw Hill) and a regular writer for Forbes, he constantly challenges conventional wisdom on leadership, management, stewardship, sustainability and corporate governance.

Part One: Stewardship and Steward Leadership Chapter 1: From ESG to ESL Chapter 2: A Higher Form of Personal Leadership Chapter 3: Enterprise-wide Steward Leadership Part Two: Steward Leadership in Action and Inaction Introduction to Part Two Chapter 4: Faber-Castell: More than 260 Years of Sustainability Enabled Profitable Growth Chapter 5: Doi Tung Development Project: Self-sustaining Community Stewardship Chapter 6: The Tata Group: A 155-Year Legacy Chapter 7: Mars, Incorporated: The Role of Corporate Values in Anchoring Purpose Chapter 8: Farm Fresh: Dairy, Just as Nature Intended Chapter 9: Riau Ecosystem Restoration (RER): Finding Purpose in Adversity: An Asian Story Chapter 10: The Boeing 737 Max Twin Tragedies Chapter 11: Volkswagen: When the Mighty Stray Chapter 12: Theranos, the Unicorn: A Case of Purpose-washing? Part Three: Steward Leadership Measurement and Applications Introduction to Part Three Chapter 13: Is ESL Tangible and Measurable Enough? Chapter 14: Steward Leadership in Business Ecosystems Chapter 15: Steward Leadership and DEI: Leading Inclusively for Sustainable Growth