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24 Jul 2020

Industry

Sustainable business management: mechanism to steer the economy and society towards the future (Current Issue No.3127)

              Based on the Environmental Performance Index (EPI) for 2020, Thailand is ranked at no. 78 in the world, moving up from no. 121 in 2018 – which is better in comparison to countries of similar ranking in 2018, such as China and the Philippines. In consideration of the various indicators, Thailand has performed much better than the global average and improved by a greater degree than countries of similar standings in many dimensions, ranging from air quality and fisheries to waste management and wastewater treatment – all of which, however, remain below the global average. Such indices reflect some of the ongoing environmental issues at present, including fine particulate matter 2.5 (PM 2.5), water management and drought. These matters indicate that Thailand still needs to continually raise its standards of societal and environmental management. Businesses, which play a major role in determining consumer behaviors, will serve as an important mechanism in driving the economy towards sustainability.

             Under the present economic conditions where the business sector is facing hardships from the COVID-19 pandemic, businesses are compelled to give top priority to their own survival and risk management. Businesses with the potential to embrace Environmental, Social and Governance (ESG) sustainability management should consider two key factors that could benefit forward-looking businesses, namely 1) Marketing opportunities based on NextGen consumers who are willing to pay more to promote environmental protection; and 2) Pressures from non-tariff measures which are aimed at raising product quality and protect consumers.

                    KResearch perceives that businesses that trade in agricultural products, food, energy, logistics, chemicals and plastics are major players that may need to quickly adjust themselves for long-term sustainability. While such adjustments may accumulate incremental cost for businesses, emphasis on sustainable business management should have positive effects on these businesses in the long run, which would be reflected in a competitive advantage and comparatively lower financial costs. Business mechanism and the government's sustainability public policies, if implemented, should promote sustainable development for the country as a whole, and thus potentially contribute to improved EPI assessment for Thailand in the future.


Industry