Giving Compass' Take:

• Stanford Social Innovation Review discusses why social and environmental assessments of private enterprise needs to go beyond avoiding risk, and take into account many different factors, including overall strategy.

• How can we develop a more robust view of Corporate Social Responsibility, one that can anticipate potential pitfalls? We all need to think bigger and bolder.

• Here are three ways to activate your own CSR mission.

Investors are increasingly holding corporations accountable for social and environmental outcomes, not just for financial performance. According to the Global Sustainable Investment Alliance, sustainable, responsible, and impact investing in the United States is continuing to rise. Socially responsible investing (SRI) assets at the beginning of 2016 totaled $8.72 trillion — up 33 percent from $6.57 trillion in 2014 — representing nearly 22 percent all investment assets under professional management in the United States. Given this trend, we will likely start to see even more companies responding to investor pressure and taking action on important societal challenges.

I welcome this change. Yet, many of the environmental, social and governance (ESG) assessments we use to evaluate SRI strategy investments are oriented around reducing risk, and few seem to take into consideration a more holistic view. Too often, society has come to regret the unintended consequences of well-intentioned decision-making that relies on an incomplete fact base.

As I look at the current state of ESG assessments, I see a reliance on metrics that can easily be measured and a focus on controversies as a proxy for risk, rather than a robust understanding of the system in which companies exist. As a result, I am concerned that investors may be inadvertently incentivizing corporate behavior that is neither in society’s collective best interest, nor reflective of their aspirations.

Read the full article about redefining corporate norms through holistic assessments by Katherine Neebe at Stanford Social Innovation Review.