SYSTEMATIC APPROACH TO MINIMIZING ECONOMIC ESG RISKS IN AGRIBUSINESS UNDER UNSTABLE MARKET CONDITIONS

Abstract

The modern agribusiness sector faces multifaceted challenges stemming from an unstable market environment, encompassing climate change, social dynamics, and governance complexities, unified under the ESG framework. This study aims to substantiate a robust, systematic approach to mitigating economic risks in Ukrainian agribusiness, addressing the volatile ESG landscape, and to provide actionable recommendations for farmers to bolster business resilience amid turbulent conditions. The research delves into the profound impacts of war-related and economic factors on Ukraine’s agricultural sector, including significant infrastructure losses, diminished arable land, disrupted supply chains, and declining export revenues. A comprehensive five-stage algorithm is proposed to minimize economic ESG risks: risk identification through stakeholder analysis and environmental scanning; probability assessment via scenario analysis to evaluate potential outcomes; risk prioritization using a risk matrix to rank threats by severity and likelihood; strategy development incorporating sustainable innovations like green technologies, precision agriculture, and blockchain for supply chain transparency; and continuous monitoring through KPIs to track progress and adapt strategies. Particular emphasis is placed on integrating war-related risks, such as supply chain disruptions and infrastructure vulnerabilities, into management frameworks, tailored to Ukraine’s unique context. The study highlights the critical role of sustainable technologies, such as vertical farming and AI-driven forecasting, alongside innovative governance practices to enhance economic stability, reduce exposure to external shocks, and promote long-term competitiveness. Practical recommendations include adopting digital tools to overcome barriers like high initial costs and limited digitalization, alongside fostering public-private partnerships to support investment in resilient agricultural systems. The findings underscore that systemic risk management is pivotal for the survival and growth of agribusiness in volatile settings, providing a strategic blueprint for policymakers, practitioners, and stakeholders to advance sustainable development and ensure the sector’s adaptability in the face of ongoing challenges.