The Rise of Multi-Stakeholder Consciousness: Building Trust in the Age of Net Zero Commitments

As we increasingly see firms making net zero commitments and announce targets, so too does the risk of greenwashing. With no harmonised definition for greenwashing, the lack of clarity for companies is not just a litigation risk, but also a reputational one. And herein lies the challenge, the standards required to bring a company’s reputation into the public eye are not necessarily the same as bringing a successful action in a court. Having a multi-stakeholder conscious approach is now very much the new normal.

Companies must consider the broader implications of their actions beyond mere compliance with regulations. They need to take into account the expectations and values of various stakeholders, including customers who are increasingly conscious of sustainability and social responsibility. Meeting these expectations requires a multi-stakeholder conscious approach, which involves engaging and collaborating with different groups such as consumers, employees, communities, and civil society organisations.

Adopting transparent reporting practices, accurately disclosing environmental impacts, and implementing credible measures to reduce carbon footprint is fundamental alongside an understanding of the reputational risk associated with the sustainability profile of the product, activity or transaction at hand.

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