Sustainable corporate governance and business valuation practices based on the ESG (Economic – Social – Environmental) framework are emerging as a leading investment trend worldwide.

In the post-pandemic context, more and more companies are moving towards ESG standards, with the aim that economic development must go hand in hand with environmental, human and social development.

LOW ISSUE RATE OF ESG POLICY

However, at the symposium “Transforming Thinking and Systems to Optimization Sustainable Corporate Governance” on September 22, a representative of the World Business Council for Sustainable Development (WBCSD), Mr. Joe Phelan, Managing Director of the Asia-Pacific region, shared the research with Die Findings from the WBCSD show that companies struggle to identify ESG risks in their day-to-day risk management, although ESG is still included in their annual sustainability report.

This is also reflected in the VBCSD-led report on research findings assessing the status of a number of industrial parks in Vietnam under the Economic – Environmental – Social and Governance Framework (EESG).

Industrial parks contribute greatly to GDP, more than 50% of the country’s export sales, but the challenges of environmental management, social concerns and labor conditions meet the country’s requirements, international partners are in place.

Despite this, the rate of promulgation of policies for economic, social, environmental and sustainable development is low. Only 39% have environmental risk management policies, 10% have circular economy policies, 13% have digital transformation policies; 16% have issued guidelines to apply the practice…

Industrial parks are more concerned with risk management (or regulatory compliance) policies than with policies that bring about sustainable development for industrial parks and participating companies.

Specifically, 21% of industrial parks care about sales, 20% about taxes, but only 13% about emissions and work, only 8% about resources. Business parks lack motivation and orientation to accompany companies or to provide content and opportunities to support companies.

Among the industrial parks surveyed, only 22% of industrial parks have management system certificates, 76% of industrial parks have no enterprise-level audit information. The operating values ​​of the industrial park have not been fully evaluated and are widely shared.

54% of industrial parks publish policies on workers’ rights. Notably, only 24% of industrial parks have issued housing and employee housing benefit financial policies.

24% of industrial parks have their own security department. 55% of industrial parks promulgate environmental policies. 12% have renewable energy policies, 13% have circular economy policies, 26% conserve water… 31% of industrial parks have an environmental department.

MUST CREATE SHARED VALUE

Assessing the benefits of implementing SDGs, Nguyen Quang Vinh, Special Vice President of VCCI, Chairman of VBCSD, said that a closer look reveals that non-financial factors such as ESG are of great financial importance.

Because a company that invests in ESG, i.e. invests in scientific and professional corporate management, is a company that is committed to sustainable development and will benefit from all aspects in the long term.

However, practicing both ESG and effective corporate governance requires investment and, in particular, a major governance shift.

To solve the above difficulties, Mr. Joe Phelan introduced a new three-line model. Accordingly, ESG is integrated through three main pillars: governance, management and finally internal audit.

Ms. Ha Thi Thu Thanh, Chief Executive Officer of Deloitte Vietnam, Vice President of VBCSD, said that consumers, regulators and private investors are the main drivers in advancing the process of sustainable corporate governance.

ESG integration is a challenging topic, but once the government commits to net emissions, ESG is no longer a responsibility but a factor in maintaining business continuity and an opportunity for sustainable development of companies in the new context. This is not just the story of public and public companies, but of all companies.

From the practical experience of applying ESG, Ms. Do Hoang Anh, Director of Legal and External Affairs at British American Tobacco (BAT) East Asia, spoke with the message “Creating shared corporate values ​​from practice.” ESG”.

According to Ms. Hoang Anh, ESG is now integrated into all of BAT’s business activities to create shared value for consumers, employees, communities and stakeholders.

By aiming to be carbon neutral, using renewable energy, conserving water and keeping landfills waste-free, in parallel with recycling waste and using sustainable sources, BAT can help contribute to efforts to combat climate change, biodiversity to preserve and plant forests.

BAT also ensures there is no child labor in the supply chain in Vietnam, provides better livelihoods for farmers and strives to build a culture of diversity and inclusion, empower women and comply with regulations.