It isn’t helpful to think about the current economic situation as “uncertain” anymore.
Managers at purpose-driven companies can only hear the word “recession” so many times—especially from the ranks of Jay Powell, Jamie Dimon, and the International Monetary Fund—before we feel quite certain that we will soon face a career-defining stress test.
Before the colors of all the leaves have changed, we may well see the U.S. Securities and Exchange Commission’s new regulations on environmental, social, and corporate governance (ESG) take effect. To be clear, the S.E.C.’s leadership on ESG should be celebrated. Sure, public companies and hedge funds will face initial hurdles filing their 10-Ks and 13Fs—none insurmountable, and all worth the time to demonstrate integrity to our stakeholders.
Nevertheless, some critics of corporate responsibility are already pulling millions from ESG champion asset managers like BlackRock. Their reactionary posture is not new, but we should be concerned that manufacturing crises will add to the intense pressure already applied to our financial system and culture by factual crises today.
The Russian invasion of Ukraine, unprecedented natural disasters exacerbated by climate change, and relentless inflation have caused tremendous real-world suffering. They also feed recession fears, and significantly complicate decision-making around ESG. Maybe we are more conscious of our personal responsibility for collective wellbeing today than we were before COVID-19. But that knowledge does not make it easier to stir up the incredible resolve required to face these many overlapping challenges with optimism.
Passing the stress test this quarter will take hard work as well as courage. Remember that your employees are your greatest asset—not only for the immense impact they can make through giving and volunteering, but also for the vitality they bring your company through true diversity of perspective, identity, and passion.
We'll overcome the fear of uncertainty—by sticking to purpose as usual.
