Earlier this week the World Benchmarking Alliance launched a report on the global state of play for responsible business conduct, sharing findings and insights from their Social Transformation Baseline Assessment. The results were extremely disappointing with only 1% of the 1,000 global businesses analysed able to demonstrate the fundamentals of socially responsible business conduct.
I attended the launch of the report and what I heard just heightened my sense that the Good Business Charter has an effective role to play in defining the S in ESG. Dan Neale from the WBA called the S the ‘poor cousin’ of ESG and I must agree. Accelerated focus on sustainability is most welcome – it is of course why we have environmental responsibility as one of our 10 components – but how often do we hear people championing some of the basic precepts of socially responsible business conduct?
In a month where we have heard a lot about the rising cost of living, why isn’t more being said about the importance of employers paying higher wages and providing secure work and caring for employee wellbeing? Messages from earlier on in the pandemic about valuing some of our lowest paid essential workers seem to be getting a bit lost.
How many business leaders are speaking openly about their people and how they are valued? It feels like business leaders like James Timpson and Julian Richer (who has now taken over the baton from James in the Sunday Times column) are few and far between. We desperately need businesses to take a hard look at society now and seek to do more to protect their workers and ensure they feel genuinely valued.
We champion the environment and we champion governance (specifically through requirements on fair payment of tax and CEO pay ratio). Yet, the more people I talk to in the responsible business/ethical space, the more I realise all we have to offer in terms of the social. Firstly, 50% of our components cover employees:
- real living wage
- a fair approach to zero or minimal hours contracts
- employee wellbeing
- employee representation
- diversity and inclusion
Beyond that we also have a separate component for ethical sourcing which then widens out to the people involved in a company’s supply chain. Add to that a business’s relationships with its customers (treat them fairly and deal with disputes) and suppliers (pay them promptly) and it feels like the GBC can really offer a sensible, achievable and straightforward framework on how a business might behave in a socially responsible way.
A simple baseline perhaps? An entry point which should and could become established practice? A choice for those wanting to invest ethically? Consumer research shows it is not just the environment that consumers are concerned about. Yes, we want to make sure businesses are sustainable, but if they do that whilst treating their staff poorly is that really acceptable? A truly responsible business will not allow employees to be paid a wage they cannot make ends meet on. A truly responsible business will ensure that each employee is welcomed into the workplace and has a voice, where there is no harassment and where wellbeing is championed.
Businesses have an opportunity to do their bit for a society that is facing terrible inequality and real hardship for those on the lowest pay. If you feel inertia because you don’t know where to start, why not take a look at the Good Business Charter? Get ahead of the pack and champion your socially responsible business conduct, not just externally to the wider world, but internally to your workers so they can see the priority you place on valuing them.