- Rich Lesser testified to the emergent interest from BCG’s clients in adopting multi-stakeholder mindsets and re-structuring their businesses for the creation of shareholder value and promotion of environmental, social & governance (ESG) factors. Lesser believes the coronavirus pandemic has demonstrated how directly a global issue can impact our personal lives and will prompt individuals and businesses to take action against imminent societal afflictions. Current events regarding environmental and social justice issues have pressured, or inspired, corporate introspection to address these issues as they relate to company operations. Lesser noted that companies that performed well along ESG metrics also tended to better avoid tail-risks on the downside and create value on the upside, outperforming companies without ESG-consciousness in shareholder value creation. Lesser said that even businesses under immense short-run performance pressure, such as airlines in the dwindling travel market, have expressed interest in coming out of the pandemic with more robust ESG initiatives.
“Total societal impact and total shareholder value creation are not two things where you have to choose one or the other, but rather it’s the combination of the two that maximize value creation both for shareholders and for the world,” Rich Lesser
- Andrea Jung’s work at Grameen has helped provide $1.6 billion in loan capital to mostly small, Black female-owned businesses. She is proud of her organization’s promotion of credit scores and asset building by low-income women entrepreneurs, but distraught by the pandemic’s disproportionate impact on low-income small business owners. A weekly poll service conducted by Grameen revealed that 85% of respondents were concerned about the future of their businesses. Since April 1, Grameen has been able to distribute 30,000 loans amounting to almost $100 million in loan capital, of which more than 90% has been paid back consistently each week. She discussed Grameen’s self-sustaining social business model and capital expansion, with all portfolios and branches selling funds from their own interest income. She also noted biases in the U.S. financial system and unequal distribution of PPP loans during the pandemic. She maintained the importance of microfinance organizations salvaging small businesses from the pandemic-induced downturn, considering the employment opportunities they create in America’s rural and urban areas, as well as in developing countries.
“People are realizing that we have to change the system—that without financial inclusion there is no just recovery,” Andrea Jung
- Jay Collins discussed Citibank’s domestic and foreign financial inclusion initiatives. Citi finds innovative ways to use financial products and platforms to formerly-unbanked customers into the financial mainstream. For example, it launched Cobro Digital, a project in Mexico enabling more than 5.5 million digital clients to send invoices and payments of up to 8,000 pesos ($400) by using QR codes on their phones at no cost. Additionally, Citi has formed risk-sharing partnerships with international development agencies like the U.S. Development Financial Corporation and the Asian Development Bank to provide financing solutions in respective local currencies.
“There has to be a desire to drive financial inclusion services to the lowest end of the pyramid, and interestingly COVID-19 is making it easier because the world is going digital faster,” Jay Collins