What is ESG, how is it different from sustainability, and when should your company start an ESG program? Alanna Fishman, managing director at FTI Consulting, joins us on this episode of Unboxing Logistics to share why ESG is critical to a business’s long-term success.

Alanna explains, “ESG literally stands for environmental, social, governance.” ESG programs focus on minimizing risks and bringing value to businesses.

To illustrate the difference between ESG and sustainability, Alanna shares an example. “Here's a sustainability statement: We believe in minimizing our footprint on the environment by reducing the amount of carbon we emit into the atmosphere. … An ESG statement would be, we are going to reduce our carbon footprint by X percent by 2025 because we can see that … this could result in millions of dollars of fines or fees or compliance costs.”

Currently, the U.S. has fewer environmental regulations than many other countries. Because of this, many organizations wonder if investing in ESG is really worth it. Alanna assures us that it is.

“You have to identify the risks that could potentially impact you from a financial or brand perspective. That includes environmental and social indicators—they're huge. You wouldn't run a good business by turning a blind eye to things that have an impact on you.”

She adds, “[ESG is] what brings in the best talent. It's what makes you want to stay for the long term. It's what makes you a better citizen of the world. It's what makes your company a better business.”

Alanna believes that “the future is regulation.” But a regulated future doesn’t have to be stressful or scary. The rise of technology like AI will make it far easier to measure your business’s impact. “Particularly in retail and logistics, keep your eye on technology changes. [Technology] is going to facilitate so much of the burden of reporting and tracking and trending your data. The future might be regulation, but it's … easier than you think.”

• Connect with Alanna on LinkedIn: https://www.linkedin.com/in/alanna-fishman-25301615/
• Visit FTI Consulting’s website: https://www.fticonsulting.com/