Industry leader Anand Mahindra on Tuesday said the biggest growth opportunities for businesses come from serving the bottom of the pyramid and following ESG (Environmental, social and governance) metrics should not be merely a box-ticking exercise.
Speaking at a panel discussion on 'Implementing Stakeholder Capitalism' at the World Economic Forum's online Davos Agenda Summit, he said it is in the interest of everyone to grow businesses sustainably.
"As a businessman, it benefits to create a business that promotes the economic prospects of as many people as possible. Businesses need to find a purpose that is transcending," the Mahindra Group chairman said.
"The biggest growth opportunity for companies comes from serving the bottom of the pyramid. We need to stop seeing ESG as a trade-off -- it's not a box-ticking exercise. It is how we serve the needs of a rising population," Mr. Mahindra added.
The WEF's International Business Council has proposed a set of universal ESG metrics to allow companies in all industries and geographies to measure and report performance.
In the same panel discussion, WEF Founder and Executive Chairman Klaus Schwab said he believes that 2021 will be a historical year in changing the philosophy of business.
Accelerated by COVID-19, businesses will increasingly recognise the need for stakeholder capitalism and the new metrics unveiled by the Forum will now allow businesses to measure and report their ESG metrics, Mr. Schwab said.
Although just the first step, it will move stakeholder capitalism on from being just a concept - "we can now walk the talk", he added.
