The growing demand on industrial production, its effects on the global ecological chain and on social relations demand that managers all over the world reassess outdated management systems, which do not collaborate in solving the problems of a globalized capitalist world. On the contrary, business and industrial management as we know it is the driving source of the outdated gearing of the relationship between capitalism, the ecosystem and the development of societies.

Managing companies with social and environmental commitment is the fundamental pillar of the new business management model, called ESG. In English, the acronym translates into its own fundamentals:

– Environmental (Environment);

- Social;

– Governance.

Until the very recent past, commercial expansion proceeded in leaps and bounds, without joint projects for environmental sustainability or social investment. The result was the degradation of natural resources, impacts on the global climate, widening social differences between economically developed countries, those that do not have investment. Although ESG is not new – its beginnings date back to the 1970s – it was only in the last decade that the debate about the future of business management gained momentum, taking ESG from a position of mere perspective to becoming a reality. Today, all possible production processes need to plan for the inclusion of social and environmental responsibility demands.

The ESG system covers, in a practical way, how industries must account not only for financial profits, but also how much the institution is able to reduce losses in the process of producing wealth and increase not only financial profits, but also manage to generate socio-environmental capital.

ESG Practices as a Business Goal

Environment, social care and Governance need to be part of the business goals of each productive sector. In other words, this means that the new management model includes and absorbs the ESG concept.

In practice, ESG management will implement, within organizations, work routines that include, for example, the regulations:

Environmental:

– environmental education – create a collaborative environment with the awareness of employees, managers and everyone involved in the production process on how each entity should collaborate to achieve the ESG goals;

– waste management – waste recycling, sewage treatment, proper disposal of chemical waste, among other actions.

– use of renewable energy – implementation of clean energy systems that use renewable production sources; adaptation of electrical systems to more modern energy management systems.

– conscious use of non-renewable natural resources – managing water consumption, expanding zero waste programs and conservation of springs;

Social:

– practices to promote gender equality;

– hiring based on ethnic, religious and racial diversity, promoting the inclusion of everyone in production processes, without discrimination;

– employee engagement in the ESG vision;

– health incentive programs;

– involvement with the community that lives around the industry or company;

Governance:

– add competitiveness and value to the brand, by adding socio-environmental values to economic goals;

– early identification of environmental risks to leverage business opportunities;

– corporate responsibility;

– ethics and transparency in management.

The ESG Success

The vast majority of today's entrepreneurs already agree that ESG practices are essential for market growth. Numerous investors have adopted the implementation of the ESG as a condition for the application of financial contributions. In the most different projects, products, startups and industries, monetary profit management practices, combined with socio-environmental profit, are already the way companies really work.

In 2022, the agribusiness giant JBS won the “Best of ESG” award held by Exame Magazine, for adopting proven effective ESG practices and goals. Since 2020, the company has implemented ESG standards and targets that have been successfully achieved and, for the next few years, the company will invest U$1 billion in projects to reduce GHG emissions by 2030, reducing the use of water in its processes by 15% also by 2030 assumed the goal of being Net Zero by 2040.

Going further, social pressure on issues such as climate change and social inequality, environmental guidelines from international organizations such as the UN and even the change in consumer thinking – who is concerned about the position of companies in the face of problems caused by the supply chain production – resulted in the way corporations deal with their management. The future of any market, be it international or communitarian, will from now on be planned and executed from the perspective of capital, society and the environment.