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Reconciling Financial and Societal Targets

Companies must redesign their business models and work with others to reshape market systems in order to overcome trade-offs between financial and ESG goals

We are seeing a surge in investor interest in companies that perform well on environmental and social impact (“ESG” criteria). By 2025, ESG funds will reach $53 trillion, or one-third of all assets under management, driven by the global climate and inequity emergencies and the opportunities these needs represent for business.

Leading companies are setting ambitious ESG targets, yet struggle to meet them when they continue to position “sustainability” as an afterthought, a retroactive risk management remedy for the consequences of strategic and capital allocation decisions made only with a financial lens. That is a vast lost opportunity to win in the emerging green and just economic transition underway globally.

In our article The Essential Link Between ESG Targets and Financial Performance in Harvard Business Review, FSG’s co-founder Mark Kramer and managing director Marc Pfitzer describe why doing the math on the “impact intensity of profit” is necessary to surface opportunities and constraints to meeting both financial and ESG targets and opens the way to exploring business model and ecosystem transformation that will outcompete in today’s economy.

There Are 6 Practices Needed

How We Can Help Your Company

FSG has deep expertise in shaping market systems to help companies deliver profitably on their ESG goals.

We build business collectives that work with other sectors to understand the system-wide economics of delivering better outcomes and redesign respective contributions to optimize outcomes for all stakeholders.

For example, we’ve helped companies figure out how to pay more to workers and farmers in the supply chain while continuing to purchase goods and services competitively.

We’ve also helped health care products and services extend positive outcomes to vulnerable populations without compromising on profits.

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Meet the Team

portrait Marc Pfitzer

Marc is a managing director at FSG. He is co-author of several articles on shared value and the economics…

Sebastien has extensive experience in the health care industry as a former physician, consultant, and private equity investor.

Flynn works with corporate clients on projects in the areas of shared value, global health, and global development. She…

Rishi Agarwal brings over two decades of experience in operations, strategy consulting, and global development. Rishi focuses on leveraging…

Nikhil has significant experience advising multi-national corporations, governments, international NGOs, foundations, and social enterprises on emerging market…

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