Guest Editorial by Rashida Salahuddin, President & CEO of The Corporate Citizenship Project
Ever since the U.S Securities and Exchange Commission (SEC) proposed rules governing climate-related disclosures from all public companies on March 21, environmental, social, and governance (ESG) reporting has become a necessary part for technology company corporate boards to address, especially in today’s environmentally and socially conscious world.
Whether it’s understanding how the technology company is combatting climate change, how diverse the technology company’s leadership is, or what the technology company’s corporate policies are investors, customers, and even their own employees want transparency into the ESG impacts, both good and bad, of the technology company’s activities and their sustainability initiatives.
(Learn what ESG is and why it’s important to incorporate it into your decision-making as a company. Courtesy of Incitement and YouTube. Premiered Apr 26, 2021.)
However, to fully understand the standards technology corporate boards need to play in navigating their ESG reporting, we first need to understand what’s wrong with the current system.
The State of ESG Reporting Today
When technology companies disclose ESG reporting in their annual reports, proxy advisory firms, such as Institutional Shareholder Services (ISS), take that information and basically put it on a rating system, where all of the technology company’s ESG efforts are graded on an ABCD+- level.
Some proxy advisors including ISS also assess companies for overall positive or negative social impact and assign them a score. For example, just by visiting ISS’s ESG Gateway1, you can see that ISS assigns Apple a “B” ESG rating and was judged to have a +3.5 limited positive social impact.
Amazon’s ESG Corporate Rating is a C- and is judged to have a –5.3 significant negative social impact.
Proxy advisors rarely delve deep into the reasoning for companies’ ratings which poses a challenge for investors attempting to ascertain which companies are the most environmentally or socially conscious.
For Board of Directors at technology companies, this challenge is even more significant. Because proxy advisors are opaque about their standards for obtaining high ESG marks, it is very difficult to know which factors are most critical. Case in point, Apple and Amazon have relatively similar corporate diversity, pay levels, and operations however they have significantly different ESG and social impact scores from ISS.
Because proxy advisors’ standards are so opaque, a cottage industry has formed of ESG Consultants who help companies achieve higher ESG rankings. The challenge is, proxy advisors like ISS also offer such services. Many, including the SEC, have taken issue with this business model because of the potential for conflicts of interest.
This resonates similarly with what happened more than 20 years ago between energy-trading company Enron Corp. and accounting firm Arthur Andersen LLP, as Enron kept debt off its balance sheet when reporting annual financial earnings, thus making them a subject of a federal investigation, and sparking the conversation for a new set of standards to maintain financial integrity.2
(Enron represents perhaps the most popular example of how a corporation can go from hero to zero or in their case, from a stock price of $90.75 and a market capitalization which made it the 7th largest US corporation to bankruptcy. Courtesy of One Minute Economics and YouTube. Posted on Aug 9, 2016.)
Today’s ESG reporting mirrors this situation, as companies may try to do anything they can to earn a better grade and impress their investors. Shareholders and stakeholders want to see credible environmental and social change through a new set of ESG standards, but the current ESG system needs to first be resolved.
What Needs to Change?
With the current ESG evaluation system seemingly more focused on ratings than bringing about change, proxy advisors issuing these ratings need to consider reforming their organizations to focus on either ESG ratings or ESG consulting, as both operations create the challenges we are seeing with companies trying to leverage the system for their own beneficial evaluations, instead of actually identifying true change throughout the technology industry.
Just like the Enron story, consulting firms were helping the company boards prop themselves with false reporting, leaving shareholders to hold the bag of worthless stocks and company valuations at the end of the day.
Even though ISS is not the only proponent of ESG ratings, proxy advisors use their own methodologies to rank and score technology companies, which the reports produced are at times rife with inaccuracies and ultimately sows confusion in the markets.
These inaccuracies then consume the bandwidth of technology companies as they scramble to address misstatements that surface in these reports – taking up valuable time that could be much better spent on actually improving ESG performance.3
Basically, the people at the shareholder and stakeholder level, who actually do want to see technology companies adhere to a set of ESG standards, are the losers in the current system.
Instead of having the transparency of technology companies who are actually responsible in terms of ESG, investors are essentially in this conflict-of-interest system where ESG ratings mean nothing unless change is in fact taking place.
(Climate change, weapons, and diversity, equity, and inclusion, or “DEI” for short, are all key issues that have received widespread coverage. But aspects of these high-profile topics that have remained latent in ESG discussions thus far are expected to come to the fore in 2022. Courtesy of Institutional Shareholder Services and YouTube. Posted on Feb 22, 2022.)
The New ESG Standards for Technology Companies
When thinking of the standards technology corporate boards need to focus on in their ESG reporting, there needs to be checkbox standards across each environmental, social, and governance branch that the technology company reports, where any investor can publicly verify that reporting themself.
Without transparency, the system will continue to hurt companies that are supporting ESG goals while benefiting those willing to “game” the system. A transparent system will instead give ESG-conscious investors a leg up in understanding their investments while benefiting companies truly committed to doing the right thing.
About The Author
Rashida Salahuddin is the President & CEO of The Corporate Citizenship Project.
Born and raised in Los Angeles, Ms. Salahuddin has spent most of her career in Public Affairs working for a diverse array of companies including Financial Services, Entertainment, and Energy.
She is spearheading the Corporate Citizenship Project to address the challenges and ethical issues she has seen first-hand in the field of corporate governance.
Salahuddin is a believer that corporate America should be transparent and should practice what they preach.
For more information, please visit https://corporatecitizenshipproject.com/.
American Security Today’s Annual ‘ASTORS’ Awards is the preeminent U.S. Homeland Security Awards Program, and now in its Seventh Year, continues to recognize industry leaders of Physical and Border Security, Cybersecurity, Emergency Preparedness – Management and Response, Law Enforcement, First Responders, as well as federal, state and municipal government agencies in the acknowledgment of their outstanding efforts to Keep our Nation Secure.
Excellence in Public Safety & Community Enrichment
PWPORG (Preparedness Without Paranoia) is a 501(c)(3) built by law enforcement and security industry practitioners and educators to provide educational resources to kids, families, and communities on safety and emergency preparedness.
PWPORG is proactively taking action to introduce the children and families in our communities, to skills and educational resources on safety and emergency preparedness, that when learned and practiced, will last for a lifetime.
Guided by Dr. Kathleen Kiernan, a 29-year veteran of Federal Law Enforcement and President of NEC National Security Systems, the nonprofit PWPORG was created to educate, engage and empower families and kids on issues of preparedness and resiliency to create a safer world, free of active threats and human traffickers.
(Learn about how YOU can Make a Difference in the lives of our Nation’s Children and Families. Be a Superhero, Make a Donation and Make a Difference by helping to support Preparedness Without Paranoia and Parents with Preparedness Magazine. Courtesy of Kiernan Group Holdings and YouTube.)
PWPORG is accepting charitable, donations, contributions, and corporate/agency sponsorships to provide Safety and Emergency Preparedness Training to children’s groups in your community.
Please consider taking action to provide educational resources to kids, their families, and their communities today.
Every donation will make a difference and all donations go towards developing new children’s books, parental resources, and educational content.
Become an author of change that can forever enhance the life of a child! Visit pwporg.org/contribute
Are you a parent, caregiver, first responder, or educator who would like to contribute your experience, strength, hope and expertise in an upcoming edition of Parents With Preparedness magazine?
If so, also visit pwporg.org/contribute and sign up to be an author of change!
Dr. Kathleen Kiernan is the Founder of PWP, as well as the Founder and CEO of national security, education, risk management, and training firm Kiernan Group Holdings (KGH), Chair Emeritus of InfraGard National Members Alliance, and adjunct faculty member at the Naval Postgraduate School.
Dr. Kiernan is also the President of NEC National Security Systems (NSS), which leverages its parent company’s rich history of innovation and service to the U.S. government with scientific curiosity, robust R&D budget, and flexibility to rapidly prototype custom solutions.
With a special focus on the ultimate soft-target, our Nation’s schools, Kiernan believes preparedness is a mindset that can be learned and when practiced, prevents ordinary days from turning into extraordinary ones due to an active threat in any form, including those posed by insiders.
(Hear directly about the ‘Preparedness Without Paranoia’ Education and Training Series from Dr. Kathleen Kiernan, CEO & Founder of Kiernan Group Holdings. Courtsy of KGH and YouTube.)
A 29-year veteran of Federal Law Enforcement, Dr. Kiernan retired as Assistant Director for the Office of Strategic Intelligence and Information for ATF, serves as a subject matter expert for the defense, intelligence, and law enforcement communities, and works with organizations making a difference in the world including the Business Executives for National Security (BENS) Resilience Council, the AFCEA Intelligence Committee, and the Center for Advanced Red Teaming (CART), University of Albany, SUNY.
The United States was forever changed 20 years ago on September 11th, and we were fortunate to have many of those who responded to those horrific tragedies join us at the 2021 ‘ASTORS’ Awards Luncheon.In the days that followed 9/11, the critical needs of protecting our country catapulted us into new and innovative ways to secure our homeland – which is how many of the agencies and enterprise organizations that are today ‘ASTORS’ Awards Champions, came into being.
Our 2021 keynote speaker featured a moving and informative address from TSA Administrator and Vice-Admiral of the United States Coast Guard (Ret), David Pekoske; to our attendees who traveled from across the United States and abroad, on the strategic priorities of the 64,000 member TSA workforce in securing the transportation system, enabling safe, and in many cases, contactless travel.
Legendary Police Commissioner William Bratton of the New York Police Department, the Boston Police Department, and former Chief of the Los Angeles Police Department was also live at the event, meeting with attendees and signing copies of his latest work ‘The Profession: A Memoir of Community, Race, and the Arc of Policing in America,’ courtesy of the generosity of our 2021 ‘ASTORS’ Awards Premier Sponsors.
The 2022 ‘ASTORS’ Awards Program is Proudly Sponsored by New PLATINUM SPONSOR: NEC National Security Systems (NSS), New Premier Sponsors Rajant Corporation, and guardDog AI, and returning Sponsors to date, Automatic Systems, RX Global, and SIMS Software!
The continually evolving ‘ASTORS’ Awards Program will emphasize the trail of Accomplished Women in Leadership in 2022, as well as the Significance and Positive Impact of Advancing Diversity and Inclusion in our Next Generation of Government and Industry Leaders. #MentorshipMatters
So be on the lookout for exciting upcoming announcements of Speakers, Presenters, Book Signing Opportunities, and Attendees at the 2022 ‘ASTORS’ Awards Presentation Luncheon in November of 2022 in New York City!
Nominations are currently being accepted for the 2022 ‘ASTORS’ Homeland Security Awards at https://americansecuritytoday.com/ast-awards/.
|Access Control/ Identification||Personal/Protective Equipment||Law Enforcement Counter Terrorism|
|Perimeter Barrier/ Deterrent System||Interagency Interdiction Operation||Cloud Computing/Storage Solution|
|Facial/IRIS Recognition||Body Worn Video Product||Cyber Security|
|Video Surveillance/VMS||Mobile Technology||Anti-Malware|
|Audio Analytics||Disaster Preparedness||ID Management|
|Thermal/Infrared Camera||Mass Notification System||Fire & Safety|
|Metal/Weapon Detection||Rescue Operations||Critical Infrastructure|
|License Plate Recognition||Detection Products||COVID Innovations|
|Workforce Management||Government Security Programs||And Many Others to Choose From!|
Don’t see a Direct Hit for your Product, Agency or Organization?
Submit your category recommendation for consideration to Michael Madsen, AST Publisher at: email@example.com.
In 2021 over 200 distinguished guests representing Federal, State and Local Governments, and Industry Leading Corporate Firms gathered from across North America, Europe, and the Middle East to be honored among their peers in their respective fields which included:
- The Transportation Security Administration (TSA)
- ICE Homeland Security Investigations (ICE HSI)
- Customs & Border Protection (CBP)
- The Federal Protective Service (FPS)
- Argonne National Laboratory (ANL)
- DHS Science & Technology (S&T)
- The National Center for Disaster Medicine & Public Health (NCDMPH)
- The American Red Cross
- The InfraGard National Alliance
- The Metropolitan Police (MPD)
- The U.S. Fire Administration (USFA)
- Naval Postgraduate School Center for Homeland Defense and Security (CHDS)
- The Federal Air Marshals Service
- The San Diego Harbor Police Foundation, and Many More!
Corporate firms, the majority of which return year to year to build upon their record of accomplishment include:
AlertMedia, Allied Universal, AMAROK, ATI Systems, Attivo Networks, Axis Communications, Automatic Systems of America, BriefCam, Canon U.S.A., Fortior Solutions, guardDog.ai, Hanwha Techwin of America, HID Global, Mark43, IPVideo Corporation, Konica Minolta Business Solutions, Lumina Analytics, NEC National Security Systems, NICE Public Safety, OnSolve, PureTech Systems, Quantum Corporation, Rave Mobile Safety, Regroup Mass Notification, Robotic Assistance Devices, Rajant Corporation, SafeLogic, Senstar Corporation, ShotSpotter, Singlewire Software, SolarWinds Worldwide, Teledyne FLIR, Valor Systems, and Wiresecure, just to name a few!
Why American Security Today?
American Security Today is uniquely focused on the broader Homeland Security & Public Safety marketplace with over 75,000 readers at the Federal, State, and local levels of government as well as firms allied to the government.
American Security Today brings forward a fresh compelling look and read with our customized digital publications that hold readers’ eyes throughout the story with cutting-edge editorial that provides solutions to their challenges.
Harness the Power of the Web – with our 100% Mobile Friendly Publications
AST Digital Publications are distributed to over 75,000 qualified government and homeland security professionals, in federal, state, local, and private security sectors.
‘PROTECTING OUR NATION, ONE CITY AT A TIME’
AST Reaches both Private & Public Experts, essential to meeting these new challenges.
Today’s new generation of public safety and security experts need real-time knowledge to deal with domestic and international terrorism, lone wolf attacks, unprecedented urban violence, shifts in society, culture, and media bias – making it increasingly difficult for Homeland Security, Law Enforcement, First Responders, Military and Private Security Professionals to implement coordinated security measures to ensure national security and improve public safety.
These experts are from Government at the federal, state, and local level as well as from private firms allied to the government.
AST provides a full plate of topics in our AST Monthly Magazine Editions, AST Website, and AST Daily News Alerts, covering 23 Vital Sectors such as Access Control, Perimeter Protection, Video Surveillance/Analytics, Airport Security, Border Security, CBRNE Detection, Border Security, Ports, Cybersecurity, Networking Security, Encryption, Law Enforcement, First Responders, Campus Security, Security Services, Corporate Facilities, and Emergency Response among others.
AST has Expanded readership into integral Critical Infrastructure audiences such as Protection of Nuclear Facilities, Water Plants & Dams, Bridges & Tunnels, and other potential targets of terrorism.
Other areas of concern include Transportation Hubs, Public Assemblies, Government Facilities, Sporting & Concert Stadiums, our Nation’s Schools & Universities, and Commercial Business Destinations – all enticing targets due to the large number of persons and resources clustered together.
(See just a few highlights of American Security Today’s 2021 ‘ASTORS’ Awards Presentation Luncheon at ISC East. Courtesy of My Pristine Images and Vimeo.)
To learn more about ‘ASTORS’ Homeland Security Award Winners solutions, please see the 2021 ‘ASTORS’ CHAMPIONS Edition Fully Interactive Magazine – the Best Products of 2021 ‘A Year in Review’.
The Annual CHAMPIONS edition includes a review of Annual ‘ASTORS’ Award Winning products and programs, highlighting key details on many of the winning firm’s products and services, including video interviews and more.
It serves as your Go-To Source throughout the year for ‘The Best of 2021 Products and Services‘ endorsed by American Security Today, and can satisfy your agency’s and/or organization’s most pressing Homeland Security and Public Safety needs.
From Physical Security (Access Control, Critical Infrastructure, Perimeter Protection, and Video Surveillance Cameras and Video Management Systems), to IT Security (Cybersecurity, Encryption, Data Storage, Anti-Malware and Networking Security – Just to name a few), the 2021 ‘ASTORS’ CHAMPIONS EDITION has what you need to Detect, Delay, Respond to, and Mitigate today’s real-time threats in our constantly evolving security landscape.
It also includes featured guest editorial pieces from some of the security industry’s most respected leaders, and recognized firms in the 2021 ‘ASTORS’ Awards Program.
For a complete list of 2021 ‘ASTORS’ Award Winners, begin HERE.
For more information on All Things American Security Today, as well as the 2021 ‘ASTORS’ Awards Program, please contact Michael Madsen, AST Publisher at firstname.lastname@example.org.
AST strives to meet a 3 STAR trustworthiness rating, based on the following criteria:
- Provides named sources
- Reported by more than one notable outlet
- Includes supporting video, direct statements, or photos