Stay the Course, Pick Up the Pace: My Takeaways from Aspen ESG Summit '24

Upheaval in global alliances. Violent conflict and civil unrest at a tipping point. The ravages of climate change with record breaking heat and rain. And political flashpoints everywhere we turn, from France to Venezuela, to here at home. 

How will this chapter of history be written?  

The business environment is at best uncertain. Yet the tenor at this year’s Aspen ESG Summit was about progress on systemic problems. Commitments to decarbonization, diversity and economic opportunity may bring headlines and friction, but the “anti-woke” narrative is not holding leading companies back. 

When we polled attendees including business executives working to advance sustainability goals in large global enterprises—industrials to consumer products—and their counterparts in finance, we found the backlash was having less of an effect than the headlines suggest; 43% agreed their work had gotten easier in the last year. That leaves a significant share who say that the heated rhetoric on “ESG” is still adversely affecting their ability to do their jobs. But the trend is positive.  

Martin Whittaker of Just Capital agrees: “Despite a wider sense of societal instability, the corporate stakeholder space feels relatively steady…debates and discussions around corporations’ role in society continue, but have become markedly less heated and divisive, and more private, measured and–dare I say–meaningful.”  

That doesn’t mean the work ahead is easy.  

To amass sufficient and affordable capital to underwrite the energy transition requires clear and consistent market signals, and sensible policy, including permitting reform. Leaders say while they are more confident than ever that breakthrough technologies are on the horizon and the pathway for industry decarbonization is gaining clarity, real questions remain about the market structures and incentives to scale the transition at the speed we need.    

And the biggest barrier to steady progress may be one of our own making—the quest for “alpha” and unrelenting short-term market pressures on stock performance. 

Yet the conversation at the Summit was different than a decade ago; the debate now isn’t about Why, it’s about How. Edelman’s Trust data reminds us that in spite of upheaval and push back and culture wars, business is still, by and large, a trusted institution—trusted especially for its capacity to get things done.  

Corporations have an instrumental role to play. What is possible now? 

As the noise around ESG shifts and settles, we see things more clearly. Here are key takeaways about the path forward from Summit 2024:  

• First, the great “pushback” against progressive action by corporations has proved useful. I agree with Martin Whittaker, and think we have weathered the most unreasonable charges against business. More importantly, I think this moment—as frustrating, and enervating as it has been—has also been clarifying.  

The anti-woke narrative compels executives to think anew about what we really mean by so-called “stakeholders”—and to identify which commitments and investments matter most to the long-term health of the enterprise. On what, or whom, is the corporation truly dependent—or co-dependent? 

• Second, picking up the pace of change requires a hard look at the business model. Carefully structured B2B and public-private-NGO collaborations are needed to tackle problems at the source. You don’t protect an endangered species or address human rights in the supply chain one company at a time. 

Corporations are granted limited liability to take risks and innovate. Business-facing NGOs and intermediaries are allies in pursuit of innovation at scale: they bring an outside-in perspective and clarity about systems and resources at risk.  

• Finally, who pays?  Access to nature is still a public good—largely unpriced—even as constraints and reporting and the cost of operating sustainably grows. Yet, consumers and business customers demonstrate little tolerance for higher prices due to the higher costs of manufacturing or fairer wages and better conditions in the supply chain.  

Andy Hoffman at the University of Michigan cautions us about the “win-win” narrative that focuses on the upside of a green economy without speaking to difficult, win-lose business decisions that dominate. Wicked problems persist. Global brands that operate under the microscope of public exposure can become real allies in addressing these problems at the source, but to persevere requires translating innovations in the supply chain into greater efficiency and a lower cost of capital.  

Meanwhile, corporate governance continues to be a battleground. Swasti Gupta-Mukherjee at Loyola University Chicago writes, “with increasing scrutiny and demands for accountability, the role of the Board of Directors is under the spotlight like never before. The evolving realities, liabilities, and expectations of their governance role means that board members need to educate themselves and understand their expanding scope of responsibilities.”  

These are challenging times. Boards need new perspectives and new structures to focus on the future. Empowered employees are looking for commitment from executives. In spite of the challenges, and with all the fits and starts, we are witnessing what is possible when business aligns vision, resources and capacity. With election season in full play, we the citizens are looking ahead to the next chapter; the signals we send will reverberate well beyond our borders.   

Judy Samuelson is executive director of the Aspen Institute’s Business and Society Program and author of “The Six New Rules of Business: Creating Real Value in a Changing World.”