Home ›› 21 Jun 2022 ›› Editorial
Climate change and the challenges there on are among the top risks for topical countries like ours. Bangladesh is the largest delta in the world and hence challenges from the climate change will be very critical. The impact on environment due to loss of land, increased salinity will impact on social and economic conditions.
Nowadays in the digital world the addiction to online games have occupied a major portion of the active time for a sizeable population. This addiction has a deep impact on the social life of a person including work, family and leisure time. This has turned into a social risk. Social risk can be defined as the exposure to adverse consequences stemming from population-based activities and negative public perception. In other words, social risk is a manifestation of what goes on around us and is driven by influences inside every one of us—beliefs, emotions, mental health, fears and anxieties. Social risk’s population-based nature sets it apart from traditional risk events such as cyberattacks, workplace safety incidents, corporate malfeasance and natural disasters. Traditional risk events impact a discrete set of people, while social risk can impact broad segments of society.
The disruption in normal regular lives due to Corona pandemic has a deeper impact on social life across all the ages and gender.
While the students for two consecutive years at a stretch were forced to attend classes digitally will have impact on their mental set up, the ghastly news of death and dislocation due to job losses may act as a serious deterrent on a large number of individuals.
Social risk arises from negative perceptions of an organisation’s impact on the community. The social risks of a venture depend on the specific issues associated with an organisation’s operations, the industry sector and the geographic context. Risks typically include environmental pollution, hazards to human health, safety and security, and threats to a region’s biodiversity and cultural heritage. Social risk is characterised by four components in combination: an issue, a stakeholder or group of stakeholders, a negative perception about an organisation, and the means to do damage.
Management and mitigation of social risk factors are increasingly important for business success abroad. The costs of losing that social licence, both in terms of the organisation’s share price and the bottom line, may be significant. Ignoring social risk factors can lead to significant negative consequences to an organisation’s reputation and operations. With no mitigation plan in place, these organisations have been subject to bad publicity, consumer boycotts and other negative outcomes. The advent of social media has had a large influence on how quickly these negative consequences can be realised and spread. As organisations take advantage of global opportunities, there is a growing understanding that it makes good business sense to incorporate responsible business practices into investments and operations abroad; these practices also benefit the local economies and communities. When organisations operate in an economically, socially and environmentally responsible manner, and they do so transparently, it helps them succeed. This is accomplished through encouraging shared values and social license with clients, customers and stakeholders. In most cases, organisations can take steps to mitigate these risks. Some organizations have successfully mitigated these concerns through a range of activities classified as corporate social responsibility (CSR), which covers all of the voluntary actions a company can take to operate in an economic, social and environmentally sustainable manner. Popular CSR steps include building closer relationships with local partners and stakeholders, increased transparency and public reporting, closer monitoring of suppliers and others in their supply chains, abiding by voluntary international standards for environmental emissions or labour rights, and ethically obtaining the rights to purchase or use any land.
From the quality of the air you breathe to the condition of the roads you drive on, environmental factors can have a major influence on your health. What’s more, these factors have evolved considerably over time, due to both natural and human-caused events.Professionals in the environmental health field examine how people interact with the world around them, chronicling the many ways that these interactions can impact physical fitness, vulnerability to disease, and other aspects of human wellness.
Through strategic efforts to improve environmental health, public health professionals can enhance personal wellness for individuals, families, and communities.
Maintaining a healthy environment is essential for helping people live longer and for enhancing their quality of life. Consider a sobering statistic from Healthy People, which notes that 23 per cent of all deaths (and 26 per cent of deaths among children ages 5 and younger) result from entirely preventable environmental health problems.
By optimising environmental health, communities can reduce exposure to disease, as well as to pollutants that have a toxic effect on the body. The benefits of environmental health interventions can improve life for everyone, but may have the most pronounced effect among those who are already in vulnerable health. As Healthy People points out, “Poor environmental quality has its greatest impact on people whose health status is already at risk.”
Environmental health isn’t just a matter of individual wellness; it’s also a matter of community well-being. Simply put, the conditions in and around our homes, schools, playgrounds, and workplaces can have a major impact on our families and neighbours.
For example, factors such as pollution and litter can make residents less inclined to go outside for exercise and recreation, potentially making the entire community more prone to disease.
Aspects of the built environment, such as infrastructure, can also impact community health. For instance, areas with poorly maintained roads have higher risks of car accidents that result in injuries, and inadequate sanitation infrastructure can increase the prevalence of disease in local populations.
Social risk is also tied to the idea of Triple Bottom Line (TBL). TBL is an accounting framework that incorporates three dimensions of performance: social, environmental and financial. This differs from traditional reporting frameworks that focus exclusively on economic or budgetary performance. The TBL dimensions are also commonly called the three Ps: people, planet and profits. The TBL, and its core value of sustainability, has gained traction in the business world due to accumulating anecdotal evidence of greater long term profitability. For example, reducing waste from packaging is good for the environment and it can also reduce costs. Among the companies that have adopted this approach are General Electric, Unilever, Proctor and Gamble, 3M and Cascade Engineering. Over half of the global Fortune 500 companies and almost half of Standard & Poor’s (S&P’s) 100 companies now issue TBL reports. Investors incorporate these reports into their own measurements for valuing companies. Corporate Social Responsibility (CSR) is when a company operates in an ethical and sustainable way and deals with its environmental and social impacts. This means a careful consideration of human rights, the community, environment, and society in which it operates. The benefits of CSR speak volumes about how important it is and why you should make an effort to adopt it in your business.
Sustainable finance or green finance is the set of financial regulations, standards, norms and products that pursue an environmental objective, and in particular to facilitate the energy transition. It allows the financial system to connect with the economy and its populations by financing its agents while maintaining a growth objective. The long-standing concept was promoted with the adoption of the Paris Climate Agreement, which stipulates that parties must make "finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development." In 2015, the United Nations adopted the 2030 Agenda to steer the transition towards a sustainable and inclusive economy. This commitment involves 193 member states and comprises 17 goals and 169 targets SDGs aimed at tackling current global challenges, including protecting the planet. Sustainable finance has become a key cornerstone for the achievement of these goals. One factor is changing customer attitudes. A study in the US found that two-thirds of consumers of all ages prefer to buy from companies that share their values. Among millennials – people aged between 18 and 34 – that figure rises to 83 per cent. Consumers are four to six times more likely to buy from a brand with a corporate purpose they endorse, according to a global survey. But if a company does something they disagree with, three-quarters said they stopped buying from that brand and encouraged others to do the same. Carbon-intensive industries such as coal, oil and gas are also finding it harder and more expensive to raise capital as leading lenders refuse to do business with them. In contrast, sustainable
companies are more likely to win contracts, save costs by using fewer resources, have less regulation, retain the best people and avoid losing money on old carbon-intensive processes, according to research by McKinsey.Global companies took in a record $859 billion in sustainable investments in 2021, Reuters reported, including $481.8 billion in green bonds that raised money for specific environmental projects. And the level of sustainable finance is only set to grow. The total value of ESG investments is on track to exceed $53 trillion by 2025, accounting for more than a third of all global investments, according to analysis by Bloomberg.
At the TED global conference, Harvard Business School professor Michael Porter made the case that businesses can help tackle community problems, as organisations and institutions dealing with them don’t have nearly enough resources to finance the necessary change. The model in place to deal with social issues, including NGOs and philanthropies, is well-meaning but often scales with difficulty. Issues such as healthcare, access to water or education and climate change would be much better addressed with a deeper collaboration between businesses, NGOs and governments.
The writer is MD and CEO of Community Bank. He can be contacted at [email protected]
