Private Businesses towards a Sustainable Future

ESG Readiness of Private Businesses in Viet Nam 2022/2023


Focusing on stakeholders’ expectations

Private businesses are motivated by customers, competition, investors and employees to address ESG issues. Compared to publicly listed companies, they have more flexibility in reporting their ESG impact and performance. 

Thus, rather than focusing on compliance, private businesses can focus on understanding their impact on stakeholders, identifying risks and growth opportunities arising from ESG.

*Q: Factors motivating or will motivate the organisation to adopt ESG commitment (Choose many)

Owning the ESG narrative

Private businesses can take ownership of the ESG narrative through their purpose and values.

In doing this, they can build a natural alignment with stakeholders by prioritising long-term value, generational wealth, and sustainability, all with the goal of creating a legacy.

ESG makes good business sense. This focus helps businesses identify and mitigate risks related to environmental, social, and governance issues. Adopting ESG practices also encourages innovation and efficiency by driving businesses to find more sustainable and cost-effective ways of operating.

NextGens in Private and Family businesses play a key role in building this ESG narrative. Our NextGen Viet Nam Report showed their heightened awareness of ESG issues.

Explore more about NextGen’s perspectives on ESG


ESG Readiness for EPB

Private businesses in Viet Nam have kick-started their ESG journey 

Once private businesses know their current level of ESG maturity and set future ambition, the next step is to plan and navigate their ESG journey.

*Q: Choose statement that best describes the current status of the organisation’s ESG commitment

The need for ESG leadership

The current stage of ESG leadership in Vietnamese private businesses reveals a lack of ESG leadership in private businesses:

  • 34% say their Board is not involved in ESG matters (Viet Nam: 32%)  
  • 48% say there is no clear ESG leader within their organisation (Viet Nam: 38%)
  • 53% say their ESG programme run by a senior manager who has been designated to drive the ESG agenda/programme but is not fully dedicated to ESG (Viet Nam: 41%)

It's an urgent call for the business owners to take ownership of the ESG narrative and lead by example to create a sustainable and responsible business. Meanwhile, it also opens opportunities for the CFO to play a bigger role in implementing and reporting ESG goals.

Read more: The Role of Leadership in Driving ESG Initiatives

Telling the ESG story

Although private businesses are making progress in sustainability and are keeping up with listed corporations, many are not effectively communicating these efforts to the public. The current stage of ESG governance and reporting in Vietnamese private businesses suggests a lot more to do in ESG reporting.

  • 60% have informal governance structure or no structure on ESG matters (Viet Nam: 51%)  

  • 29% have well-defined ESG targets and metrics (Viet Nam: 47%)

  • 82% have no or limited external reporting on ESG matters (Viet Nam: 70%)

Private businesses, particularly family-owned ones, should prioritise ESG reporting. Why? It aligns with their values and provides an opportunity to showcase their achievements, which can differentiate them from others. While the ESG reporting can be complex, they can start small by focusing on key ESG issues relevant to their industry and stakeholders.


Enabling ESG transformation with upskilling

When we asked private businesses about what holds them back from making ESG commitment, 60% cite lack of knowledge. However, upskilling is not top of mind for companies as more than half have yet to consider training on ESG. 

Private businesses can consider upskilling as a way to communicate ESG goals to build trust and transparency; and align employees with organisational strategies. In addition, upskilling can empower employees to contribute to ESG goals and leverage multidisciplinary skills, combining technical and soft skills to drive progress towards ESG outcomes.

Read more: How upskilling can foster the ESG transformation

*Q: How has or will the organisation upskill the current staff force to have the necessary knowledge and expertise in ESG? (Choose many)

Acting short-term.                                  Thinking long-term.

Business leaders in Viet Nam are navigating the current volatile economic landscape while also preparing their businesses for the future. It requires a balancing act between these two priorities, referred to as the dual imperative, in order to succeed in the business world.

On ESG issues, it is time for private businesses to make real changes – going beyond good intentions to create a practical plan that achieves tangible results. 

Key questions for business leaders to consider about ESG today: 

  • Can we articulate in a 60 second elevator pitch how we are incorporating ESG into our business?

  • How are we communicating our values and strategy? 

  • How is ESG impacting our business and its future valuation?

To create value and address the disconnect between short-term pressures and long-term opportunities, companies must strike a balance between meeting short-term performance requirements and investing in longer-term ESG goals. By defining a clear and convincing ESG path that aligns with short-term KPIs and meets investors’ expectations, companies can ensure their long-term success and avoid the significant costs of neglecting ESG initiatives.

Johnathan Ooi - Entrepreneur and Private Business (EPB) Leader, PwC Vietnam

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Get in touch

Dinh Thi Quynh Van

Chairwoman, PwC Vietnam

Tel: +84 24 3946 2246

Johnathan Ooi Siew Loke

Partner, Entrepreneurial and Private business Leader, PwC Vietnam

Tel: +84 28 3823 0796

Nguyen Hoang Nam

Partner, Assurance Services, HCMC Office, PwC Vietnam

Tel: +84 28 3823 0796

Phung Thi Ngoc Anh

Director, Tax and Legal services, PwC Vietnam

Tel: +84 28 3823 0796