• Gustavo Bernal Torres

U.S. Corporate Boards Suffer from Inadequate Expertise in Financially Material ESG Matters

A case study highlighting the importance of ESG and supply chain management in the fashion sector and the impact on share price and investors-

  • The authors reviewed 1188 individual Fortune 100 board member credentials to determine whether companies with material ESG risks and opportunities had relevant expertise on their boards.

  • They found that very few sectors and very few companies were adequately prepared at the board level for issues that were already affecting their performance -- for example, one property and casualty insurance company has no environmental expertise on the board in a year experiencing $100 billion in damage caused by climate change--heightened extreme weather events. On another issue of growing materiality, cyber/telecom security, just eight directors of 1188 had expertise. They also examined COVID-19 and Black Lives Matter as related to board credentials and make recommendations on how to improve board ESG governance.

Source: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3758584


Recent Posts

See All

A green-finance boom has not been followed by bust. This year’s greenwashing scandals, and investors’ relaxed attitude towards them, have demonstrated an important truth: that there is money to be mad

Evidence from Environmental Integration and Sin Stock Exclusion. This paper shows how sustainable investing—through the joint practice of exclusionary screening and environmental, social, and governan