Our goal is to help avoid fragmentation of ESG standards and better enable firms to assess their ESG performance—because a company can’t change what it can’t measure.
The practice of capitalism has evolved over the past century. After World War II, a renewed social contract between citizens, government, and the private sector-led business to embrace its responsibilities to employees, communities, and society at large. This produced the greatest middle class the world had ever seen, as the bottom 90% of all Americans experienced 77% growth in real wages between 1945 and 1980.
This concept of stakeholder capitalism gradually eroded, and by the early 1970s it became widely accepted that the only social responsibility of business was to maximize profits.
Real wages of American workers declined between 1981 and 2019, despite a significant increase in productivity during that same period. At the same time, wages for the top 1% rose dramatically. In parallel, global greenhouse gas emissions more than doubled between 1975 and 2019. The Intergovernmental Panel on Climate Change (IPCC) now warns that global warming of 2°C will be exceeded during the 21st century unless rapid and deep reductions in greenhouse gas emissions are achieved.
The paradigm of shareholder primacy has weakened our social fabric, workers’ well-being, democratic integrity and has imperiled the planet. The “K” shape of the economic recovery from the Covid-19 pandemic has made these problems more urgent to policymakers and the public alike. Today, both the business and investor communities are advocating for change, as was underscored by the Business Roundtable in 2019.
We formed Novata to help empower private markets, which represent the majority of the world’s economic activity. Novata enables private companies to collect, analyze, benchmark, and report relevant ESG information. Our goal is to help avoid fragmentation of ESG standards and better enable firms to assess their ESG performance—because a company can’t change what it can’t measure.
As a public benefit corporation designed to be mission-driven and commercially sustainable, we are committed to creating value for all stakeholders. This motivates us to:
- Build products that assist private companies and their owners in making fully informed decisions about how their activities affect all of their stakeholders.
- Enable critical mass adoption of commonly-defined metrics, which in turn supports effective benchmarking and avoids the fragmentation of ESG standards that has plagued public markets.
- Facilitate efficient ESG reporting to investors and other stakeholders, which frees up company and owner time to focus on ESG performance.
- Always consider the impact of our work on our clients, employees, communities, environment, and society.
- Act with integrity in all of our actions.