Book contents
- Reviews
- The Ethics of ESG
- The Ethics of ESG
- Copyright page
- Contents
- Figures and Tables
- Contributors
- Acknowledgments
- Abbreviations
- Introduction
- 1 ESG as Dead and Alive
- 2 Ethics by Proxy?
- 3 What Is the Purpose of ESG?
- 4 The Square Peg
- 5 Success, Law, and ESG
- 6 Reforming ESG Ratings
- 7 Responsibilization of Business and the Informational Ethics of ESG
- 8 The Ethics of ESG Integration
- 9 The Ethical Quandary of Monetary Valuation in ESG Impact Measurement
- Index
- References
4 - The Square Peg
Why the Environment Won’t Fit Management Models
Published online by Cambridge University Press: 27 December 2025
Book contents
- Reviews
- The Ethics of ESG
- The Ethics of ESG
- Copyright page
- Contents
- Figures and Tables
- Contributors
- Acknowledgments
- Abbreviations
- Introduction
- 1 ESG as Dead and Alive
- 2 Ethics by Proxy?
- 3 What Is the Purpose of ESG?
- 4 The Square Peg
- 5 Success, Law, and ESG
- 6 Reforming ESG Ratings
- 7 Responsibilization of Business and the Informational Ethics of ESG
- 8 The Ethics of ESG Integration
- 9 The Ethical Quandary of Monetary Valuation in ESG Impact Measurement
- Index
- References
Summary
Firms operating in environmentally vulnerable contexts will inevitably face difficult cases where long-term profits clash with environmental values. This remains true even with enlightened management and strong regulation. Yet, business models fail to acknowledge this inconvenient truth. This chapter explains why current business models reach an "outer boundary" in their ability to incorporate intrinsic values such as environmental integrity. It introduces two key concepts: the efficiency model and the value gap. Efficiency models use terminology designed either to optimize the allocation of scarce resources toward measurable future goals or to explain the optimal achievement of past goals. A value gap arises when ideal social corporate action diverges from ideally efficient corporate action. The presence of large, recurring value gaps in extractive industries signals the need for fundamental changes – both in corporate decision-making and in the business models that shape it.
Information
- Type
- Chapter
- Information
- The Ethics of ESGCritically Assessing the Environmental, Social and Governance Movement, pp. 111 - 134Publisher: Cambridge University PressPrint publication year: 2026
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