Tracking the Trends 2019
Tracking the Trends 2019 – Volume 1 explores sustainability topics that will define the Asia-Pacific region in the years ahead
Businesses understand the importance of localizing their sustainability strategies to ensure relevance and to increase positive impact. International companies are looking to align global strategies with the expectations of local stakeholder groups and to contribute to socio-economic progress. But tracking the sustainability topics and challenges across the vast and diverse Asia-Pacific region can be daunting. Our recently launched Tracking the Trends 2019 report helps both internationally and locally operating companies to keep a finger on the pulse of emerging and current business risks and opportunities in the region.
Tracking the Trends 2019 – Volume 1, the twelfth edition of our annual expert stakeholder survey, provides a snapshot of the sustainability topics that will define the Asia-Pacific region over the next 2-5 years and how stakeholders expect businesses to respond. Drawing on insights gained from sustainability practitioners and experts, the report is essential reading for all companies looking to understand the trends, issues and stakeholders shaping the region’s diverse economies.
These are the topics that will shape corporate sustainability in the years ahead:
- Supply Chains, Labor and Human Rights as well as Climate Change continue to be priority topics. Regulatory developments and growing investor interests have elevated these discussions into boardrooms and require companies to establish more mature strategies, stronger targets and be more accountable for their actions and disclosures. As an example, Modern Slavery laws in the US, EU and Australia are directing greater attention to labor standards and human rights risks within supply chains in the Asia‑Pacific region. But policy efforts are also under way in Asia: Thailand released the final draft of its National Action Plan on Business and Human Rights and India, Indonesia, and Malaysia have formally announced intentions to follow suit.
- The global plastic waste crisis has led to a renewed interest in Circular Economy and Waste following increased stakeholder pressure from governments and consumers. Asia is the biggest contributor to marine plastic pollution and awareness of the implications for ecosystems and human health is growing. The implementation of China’s National Sword policy in 2008 drove a dramatic increase in plastic waste flows from G7 and other countries into Southeast Asia. But as a clear sign of a growing intolerance to plastic waste imports, governments in India, Malaysia, Thailand and Vietnam have announced the ban of foreign plastic scrap imports. More robust government policies, regulation and enforcement regimes on waste and single-use plastics are expected and will drive the business sector to adopt circular economy models.
- Corporate Governance, Transparency and Anti-Corruption remain of high importance amid little progress in the region on corruption and weakening democratic institutions in some countries. The role of technology and social media as a tool for transparency will likely increase the exposure of uncomfortable scenarios for business, governments and other stakeholders. New global regulatory rules and cross-border exchange of data will drive tax compliance and disclosure of taxes and fees paid to governments
- Future of Work and Digitization has emerged as a new topic in this year’s report. In Asia, this is driven by concerns of an imminent job crisis linked to automation and an aging society. The future of work applies questions at all levels and segments of the economy and in all countries across the region. Companies are expected to play a role in preparing the workforce for the transformation of job profiles through investments in upskilling and reskilling.
- The Sustainable Development Goals (SDGs) remain on the list as an important framework for corporate sustainability efforts. However, there is little evidence in the region of meaningful and impactful business contributions towards the SDGs. Questions exist on how the Asia finance sector will respond to the SDG Impact initiative and related SDG investment vehicles.
- Inclusion and Diversity and Gender Equality remain important topics, with diversity extending beyond gender, race and ethnicity to include disabilities, sexual orientation and religious beliefs. There is a growing awareness that companies committed to a diverse and inclusive workforce are better equipped to attract talent, unlock innovation and drive performance. Recent actions taken by the government in India, Hong Kong and Taiwan are starting to break down barriers for companies taking a more proactive stance on diversity issues related to LGBT+ rights.
- Health and Wellbeing makes the list for a second year, influenced by a growing awareness of the health implications of environmental risk factors (e.g. micro-plastic pollution and air pollution) and a growing expectation for companies to address employee health and wellbeing including mental health.
- Wealth Gap, Poverty and Social Imbalances regained a spot in the top topics list as disparities in income and wealth continue to grow in many Asian economies despite sustained economic growth in the region. The region’s combined income inequality, measured by the Gini coefficient, has increased by over 5 percentage points in the last 20 years thus evidencing a need for more inclusive growth models and quality jobs.
Pressure for companies to act on these sustainability topics is mounting, driven by growing investors interests and regulatory pressure from both within and outside the region. Governments in the region are increasingly prioritizing sustainability issues and expectations for government enforcement and penalties for companies are mounting. The findings of our survey draw a picture of a dynamic operating context in the Asia-Pacific region that requires companies to take a pro-active stance and make sustainability a strategic priority. The findings emphasize the increasing expectations of stakeholder groups for business to drive transformative action by working closely with governments, cross industry leaders and multi-stakeholder partnerships to address broader development challenges beyond direct business risks.
Tracking the Trends is an annual publication curated and proactively maintained for the ELEVATE Strategic Partner Program. The Strategic Partner Program connects leading companies and NGOs who share a commitment to sustainable development.
For further information, contact [email protected].
Managing sustainable development – guidance for extractive companies
Extractive companies operating in ASEAN and around the world are facing increasing pressure to address sustainable…
Business implications from latest HKEX consultation on ESG reporting guide
BlackRock CEO warns that “environmental, social, & governance issues will be increasingly material to corporate valuations."…
From rhetoric to action: building a smart Hong Kong
The concept of a “smart city” is gaining traction across the globe. Whilst the definition of smart city can vary, the term…