The rules of business are changing. While in previous decades the single goal of business leaders has been to maximise shareholder returns, new paradigms mean that a balance must be struck between profits and other concerns that fall under the rubric of ‘sustainability’.
This is the primary narrative of a new whitepaper issued by The Payments Association, which has brought to light how the rules of business are evolving.
Whilst historically, the main goal of business leaders has been to maximise shareholder returns, new paradigms identified in the data, including environmental, social and governance (ESG) and stakeholder capitalism, mean that businesses must now try to operate between the lines of profitability and sustainability.
Rather than simply admonishing companies to become more sustainable, the report offers advice from what it describes as ‘sustainability superheroes’, including Charlie Bronks, SVP, head of ESG at Crown Agents Bank, Irene Perez, head of marketing at Gain The Lead and Jim Colvine, SVP for Priceless Planet at Mastercard.
The inclusion of various case studies from companies like Mastercard, FIS and Algbra demonstrates how varied companies have successfully addressed sustainability in their business.
The project is anchored in data from The Payment Association’s members on their own ESG priorities, and this data shows that the industry is making significant progress towards embracing sustainable practices and ethical goals.
Over 90 per cent of companies measure progress towards gender equity, 80 per cent consider the social justice impacts of their products and services, 60 per cent seek to reduce waste from their supply chain and another 60 per cent have identified their ESG stakeholders and prioritised them.
Of course, the definition of sustainability varies widely and ethical goals are hard to pin down (maximising shareholder returns is arguably an ethical commitment, for example), but the results show that the fintech industry is making major strides toward integrating these ideas into its day-to-day operations.
“Now more than ever before, people want to make more environmentally sustainable decisions and that extends to the brands they do business with,” said Tony Craddock, director general at The Payments Association.
“We’re pleased our report not only outlines the ways in which companies can become more ethical and sustainable, but also that it shows that the majority of companies have already started down that path.”
Adding to this, Colvine says: ‘Increasingly, people are recognising that the things we produce, buy, and consume matter to our planet’s environment. Covid-19 only heightened these concerns, and now more than ever people want to make a positive, sustainable impact on the world.”
He adds: “It’s extremely encouraging to see the fintech industry recognise this. With most companies already showing that they’re on a path towards being more environmentally and ethically focused, it’s clear that progress is being made.
“It’s our responsibility as an industry to meet the expectations of our consumers and ensure sustainable goals are being set and met, for the planet’s sake.”