Doing Good is Good Business

Businesses succeed or fail based on how consumers and investors evaluate both products and corporate behavior. Today, more and more large corporations are being forced into good citizenship as a result of the environmental, social, and governance (ESG) practices movement.

The increasingly popular ESG framework centers around investing in businesses that address their impact on the environment, social injustice, and governance. Many investors actively seek businesses that follow ESG practices. Indeed, those that ignore ESGs do so at their own peril.

Exxon Mobil is a case in point. The global oil giant’s shareholders recently elected directors harshly critical of the corporation’s climate policy—this despite the CEO’s campaign against them. Those activist directors will now help drive the organization in ways that would have been unimaginable a decade ago and reflect the growing concern about corporations’ role in public policy.

Another yardstick that highlights the ESG trend is what organizations say about themselves. The financial research fund Sentieo conducted a study revealing that many businesses are highlighting their ESG credentials. The research group collected data that showed a marked uptick in the number of press releases that championed ESG accomplishments in the first five months of this year. Sentieo predicts that this phenomenon is here to stay.

Critics of the ESG movement contend that investors and consumers only care about ESG when stock prices are high and business is good. They claim that no matter how much investors and consumers want companies to be good citizens, that desire will fall by the wayside if fuel rises to $8/gallon, for instance.

Experts predict Exxon’s invasion by the activists is a portent of things to come. After all, oil execs used to downplay an oil spill’s environmental impact. Today, they are being forced to confront climate activists routinely.


  1. What factors have led to the ESG movement?
  2. Examine the UN-backed Principles for Responsible Investment. Look up one of the signatories and track its ESG performance.
  3. Can you find other examples of corporations adopting ESG movement policies?

Source: Grant, C. (2021, June 4.) Why doing good is no longer bad business. The Wall Street Journal. Retrieved from

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