In a COVID-1o daily update published on April 20, 2020 S&P Global explained: “As the situation surrounding the outbreak and the global economy evolves each day, a spotlight continues to shine on environmental, social, and governance (ESG) factors. According to analysis by S&P Global Ratings, the crisis has brought to light the materiality of ESG-related risks and the deep linkages between businesses and their stakeholders across the value chains.
Environmental concerns are in focus against the backdrop of discombobulation in oil markets. For now, renewable energy’s supply chains are holding up against the pandemic’s pressures, and retailers across the U.S. and Europe aren’t abandoning their commitments to reduce plastic packaging. As the oil price collapse continues, the case for investors and governments to shift more capital to the clean energy sector grows stronger, the International Renewable Energy Agency said in a report today.
S&P Global Ratings believes social factors—namely health, safety, and workforce dynamics—are currently the most acute factors with risks of direct financial consequences and indirect reputational effects.
Good governance during the crisis remains critically important. Some CEOs and management teams are taking pay cuts as their companies lay off workers to cope with the pandemic’s hit to revenue. Seen largely as a symbolic gesture, doing so could help companies manage reputational damage and enhance their ability to attract and retain workers in the long term. Additionally, experts warn that financial institutions with gender-diverse boards and managements will be better-placed to navigate the coronavirus crisis, but unless banks put gender balance at the forefront of their crisis-management strategy, the pandemic could be detrimental to the progress made by the sector, according to S&P Global Market Intelligence.”
You may read the update on the S&P Global internet site.