Environmental, social, and governance (ESG), sustainability or responsible growth, is an investment, not a cost. The whole point of ESG is to demonstrate that you are a long-term organization that operates responsibly. This entails being transparent and adhering to ESG norms and policies in one’s business.
Businesses that are both profitable and socially responsible are called sustainable. Investors and consumers, as well as staff, local communities, and others are all stakeholders. For them, profit is a tool for increasing share value, social and environmental sustainability, rather than the be-all and end-all for a business itself.
ESG and AI
If we talk about AI implementation in the company, as Environment, Social, and Governance practices suggests, it is crucial. Automating human-made decisions previously could have a tremendous impact on increasing efficiencies, spurring economic development, and alleviating many of society’s current challenges.
ESG studies suggest that over the last 200 years, technological advancements have been the most crucial driver of economic development, with each progressive era altering the way the world works. However, the intensity and scope of labor displacement caused by artificial intelligence could be far more prominent than in earlier technological age. If mismanaged, the result will be widespread unemployment with social disruptions.
In general, an individual’s particular position is rarely digitized; instead, only a fraction of their responsibilities can be automated with bot’s cognitive abilities. Since this can increase an individual’s productivity by allowing them to spend more time performing arguably more meaningful work, it also reduces the number of people needed throughout a team to do a certain level of work, allowing staff numbers to be decreased, which is an alarming sign.
However, firms are looking to re-skill their employees as part of an efficient human capital management plan to save costs, remain competitive, and minimize workforce disruption. Organizations need to make judgments to avoid falling behind over the coming years or so.
Mismanagement of this shift will not only exacerbate inequality, reversing much of the work businesses have done to address it in recent years, but it will also have an influence on the company’s long-term business performance, as they may be unable to narrow the future talent pool with their current skilled workforce.
In a post-pandemic world, artificial intelligence technology promises an exciting future of opportunities. Still, businesses, regulators, and society as a whole must think ahead about its implementation to guarantee it is actually sustainable.