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Quick Takes

Higher Social and Environmental Performance Improves Your Talent Pool

Source: MSCI ESG database, Fortune, Universum, Marsh & McLennan Advantage Analysis

Employers with high environmental, social and governance (ESG) scores are better able to attract young talent and satisfy their employees compared to those with lower scores. The most attractive companies to young professionals have an ESG score 25% higher than average. 

Sixty-four percent of consumers will “buy or boycott a brand” based on its social or political stance, according to Edelman. This trend is especially prevalent with millennials and Gen Zers, who will represent 72% of the global workforce by 2029. “Some companies have been able to promote a culture of pride through their environmental or social performance, while others have had to deal with employee activism,” according to researchers from Marsh & McLennan Advantage. 

Greater commitment to ESG can also drive a higher quality of work and employee retention: Engaged employees “work harder, stay longer and seek to produce better results for the organization,” according to research from Mercer. The importance of ESG is on course to strengthen, and as businesses emerge from lockdown and eventually seek to recruit, those with ESG initiatives will have a competitive edge over others.

Teens’ Mental Health During COVID-19 Is Slightly Better Than in 2018

Source: Monitoring the Future; Teens in Quarantine; Institute for Family Studies/Wheatley Institute

Seventeen percent of teenagers in America felt depressed while they were in school during the COVID-19 pandemic, compared to 27% of teens in 2018. In contrast, “U.S. adults in spring 2020 were three times more likely to experience mental distress, anxiety or depression than adults in 2018 or 2019,” according to a report by the Wheatley Institute.

Depression and loneliness were lower among teens in 2020 than in 2018, yet unhappiness and dissatisfaction with life were slightly higher. During the pandemic, teens were sleeping more and spending more time with their families, which helped lower all-time-high depression rates. However, financial distress still weighed heavily on teens. Out of 1,523 U.S. teens surveyed, one in four were worried that their parents couldn’t provide enough food for the family this summer. 

Mental health was already affecting teens pre-pandemic at record-high rates. The potential for new lockdowns, continued remote learning and uncertainty about the pandemic’s impact will most likely increase teens’ risk of long-term mental health issues. The CDC released a parental resource kit to help support parents in recognizing these mental challenges and ensure their child’s well-being.

Executives Are Too Optimistic About a Return to Normal

Source: Oliver Wyman Pandemic Navigator; https://pandemicnavigator.oliverwyman.com/

Note: Each example represents only one of many possible pathways to the herd immunity threshold; pathways become more numerous and flexible the further out the target date.

Many executives are making planning decisions based on the notion that by the very beginning of 2021, things will get “back to normal.” However, according to recent Oliver Wyman analysis, the long haul will be longer than most expect with normalcy unlikely before Q3 2021.

Recent news on 90-95% vaccine efficacy and significantly higher daily case run rates than those examined above will also have an impact on timing to herd immunity. Taken together, an average new daily case rate of 120,000 and a 90% efficacy vaccine, can improve the timeline by over a month and a half. However, the impact of such a rapid daily case run rate is dramatic — it would result in an additional ~200,000 deaths as compared to a run rate of 70,000 new cases per day. 

Given the long haul in front of us, companies may need to consider if what has been working for the past seven months can be sustained for the next 9 to 12.

Coronavirus Pushes Millions of Children Further Into Extreme Poverty

Source: World Bank & UNICEF

Globally, one-in-six children lived in extreme poverty prior to coronavirus. A UN study released in September showed that an additional 150 million children were already pushed into poverty as a result of the pandemic. This number will likely continue to grow from COVID-19’s impact on income generation and food security, according to a report by UNICEF and the World Bank Group. 

Sub-Saharan Africa accounts for 65.8% of children living in extreme poverty, followed by South Asia. Nearly 20% of children under five-years-old in developing countries live in extremely poor households. These regions especially have limited access to resources, such as water, education, food and electricity. Studies show that children in poverty have a higher chance of developing long-term health complications. 

The UN Sustainable Development Goals aim to prioritize funding and international cooperation to help end extreme poverty by 2030. When the public and private sector work together with communities, “change happens: families move out of poverty, children are protected from diseases, girls become students, instead of brides, and much more,” according to the United Nations Foundation. 

The Opportunity for Countries to Invest in Carbon Neutrality

Source: Oliver Wyman

China — the world’s largest emitter of greenhouse gases — announced that it will be carbon-neutral by 2060. The country accounts for nearly half of energy-related carbon emissions, mainly caused by its coal consumption. North America and Europe combined contribute to nearly 20% of the industry’s global carbon emissions, according to Oliver Wyman. Britain, the EU, Japan and South Korea recently announced their own commitments to carbon neutrality, whereas the U.S. officially left the Paris Climate Agreement in early November. 

To lower their carbon footprints, countries will need to focus investments in technical advancements that have the potential to reduce carbon dioxide in the industrial sector — which accounts for 34% of all energy-related carbon emissions. 

In the last few months, countries have prioritized the economic fallout from COVID-19 and helping businesses recover. However, the businesses that bring a “green lens” into their recovery plans have the potential to create growth, efficiency and innovation that extend beyond high-carbon industries, like energy and transport, and benefit all sectors. 

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