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Mishcon Purpose Framework

A global ESG standard for businesses looking to mitigate risk, build resilience and grow value.

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The Mishcon Purpose Framework is a global "standard" for Environmental, Social and Governance considerations, focussing on governance and management for international businesses. It combines strategic and legal aspects, and it builds on current regulatory regimes and trends, international codes and frameworks and best corporate practice. It is made up of eight distinct steps, which comprise a robust and consistent process to understand market expectations, mitigate business and legal risk and capture new business opportunities.

The Mishcon Purpose Framework takes businesses through questions to consider their:

  1. Current ESG profile,
  2. ESG risk exposure,
  3. Quality or degree of governance; and
  4. Opportunities to create value when implementing best practices.

Purpose Framework

It is important to consider materiality in each step of the Purpose Framework. Materiality are those matters that affect a company's ability to create value in the short, medium and long term. They are those facts that a potential investor could see as significantly altering their investment decisions.

Purpose and Mission

The first step is to assess the purpose and mission of your organisation, which determines its goals, values and strategy. Do you have a purpose statement? If so, how does it fit with your current ESG goals?

As an example, our firm's purpose is "to enable our clients and our people to shape the world's possibilities". This vision underpins our governance as well as driving culture and practice.

What is the purpose of your business? What does it mean to your stakeholders? A strong purpose statement that embedded in business strategy can create significant value by attracting new customers/clients, reducing costs and staying ahead of regulatory trends.

Values and Culture

Once you have defined the purpose of your organisation, it's time to look at aligning your values and culture. Do they reflect and support the purpose that you have defined in step 1?

Shared values and culture characterise the attitudes, standards and belief of an organisation and its members. Values reflect what a company stand for, and so must reflect its ultimate purpose.

Stakeholder Engagement

Next, it's time to assess the role of stakeholders in your purpose strategy and to involve them in its development.

Stakeholder engagement helps better assess context, risks and opportunities. More critically, it reduces potential gaps between stakeholders' expectations and management's goals and strategy, identifying and reducing the risk of potential liabilities.

Vision and Value Creation Goals

Your vision and value creation goals should align with your purpose. They should be SMART (specific, measurable, relevant and time-bound) and provide a framework from which to measure success.

Business performance is increasingly measured by not only financial capital, but also intangible, natural and social capital. To bolster and invest in these new forms of capital, businesses must consider their impact on society and the environment and create prosperity in all dimensions.

Inventory of Capitals and Audit

Successfully managing a business requires managing all assets and liabilities. Today, this includes intangible assets, which in many cases may not be reflected in internal reports and in the annual accounts.

Are there any intangible assets or liabilities that are not included in your inventory of capitals and audit? To what extent could these assets and liabilities impact your ability to create value and raise capital in the short and long term?

Governance, Compliance and Corporate Reporting

A company's governance provides the framework for achieving its purpose, value creation goals and vision. It also ensures effective management and compliance with regulatory and legal obligations. If a company is to build long-term value, its governance must embed ESG into its agenda.

What is the degree of quality of your governance from an ESG perspective, and how do you report this to your stakeholders?

ESG Strategy Review

To embed sustainable purpose, ESG has to be part of your core business strategy and an integral pillar of the company's value proposition to clients and society.

You need to consider your current ESG profile. Is your business ESG ready? Are you aware of what is means to your business? What changes need should you make to use ESG as a value creation tool? How are you going to manage transitional risks?

Connectivity and Outcomes

Connectivity reflects the material interactions between social, environmental and financial capital. Applying this stage of the Mishon Purpose Framework will assist you in understanding the opportunities and trade-offs associated with your ESG strategy, and how best to manage them.

Implementing the Purpose Framework

Is your business ESG ready? Do these steps underpin the day-to-day governance and management of your business? Are you running risks you are not aware of?

Whether you're coping with an emerging crisis or looking to seize opportunities, we are here to help you.

We'd like to offer you a free, 30-minute consultation with one of our Mishcon Purpose experts, to further discuss how you could apply the Purpose Framework to your corporate strategy.

Book now

About Mishcon Purpose

Mishcon Purpose is a specialist sustainability business integrating lawyers and environmental, social and governance (ESG) experts. We use the power of the law combined with ESG advice and purpose-driven insight to help our clients meet and navigate the risks and opportunities presented by a rapidly changing world.

Mishcon Purpose operates as an integrated hub within the firm, drawing on our established areas of expertise to provide three core services. The first is Purpose Advisory, which helps business to incorporate material environmental, social and governance considerations into business strategy, to mitigate risk and create stakeholder value. Next is Purpose Leadership, which works with leaders and fiduciaries to help them understand the changing nature of their duties, and how to manage risk and grow value in meeting them. The last is through undertaking Purpose Litigation, litigation that elevates standards and practices for social and business value creation and uses the law to hold those responsible for harm to account, and to catalyse change.

Mishcon Purpose sits within Mishcon de Reya LLP, a full service law firm. Mishcon de Reya LLP has an 85-year pedigree, and works internationally, with offices in London and Singapore, an association with Karas LLP in Hong Kong and a footprint in Dubai through our wholly owned multifamily office MDR Mayfair. We are an innovative firm, with over 600 lawyers and a collection of related specialist non-legal businesses offering Cyber, Technology, Brand, and Family Office services.

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