ESG – all businesses are going to have to start measuring themselves
The environmental, social and governance (ESG) agenda is already part of corporate life for big business. It is becoming increasingly important for SMEs too. At a recent event hosted in partnership with Trowers & Hamlins, ‘The ESG Imperative – why you should act now and what you should do’ guest speakers shared their insight into the important issue of environmental, social and governance and crucially what action SMEs can take to start or continue their ESG journey.
Why is ESG a vital consideration for small businesses?
Two leading experts from our hosts Trowers & Hamlins explained why ESG is vital for SMEs to consider. It is becoming a factor in access to finance, lending rates, and insurance premiums. Nichola Ihnatowic explained more about the social aspect, and what it means to be an employer of the future. In the current employee led market, it is vital that businesses go beyond the legal minimum, focus on employee wellbeing, and genuinely achieve inclusivity. She advised that companies focus on both quantitative and qualitative social targets so that they are meaningful and not artificial. She explained: ‘employees tell us that they are interested in working for organisations whose values align with theirs’.
How can you embed ESG into your decision-making?
Alison Chivers followed Nichola and shared her top tips on how to embed ESG factors into your company’s decision-making process to ensure you are best placed to get to grips with this key issue.
- Lead ESG from the top. Make sure it’s a standing item for your board meeting and make it someone’s responsibility – assign a lead for your business.
- Assess and set goals for your business. ESG is an incredibly broad topic and one size doesn’t fit all. Think about setting goals that are relevant to your organisation and where you are in relation to each aspect – environmental, social and governance.
- Don’t be afraid to get started or to make mistakes. Everyone, especially SME’s, are finding their way a little bit with ESG. There are no perfect answers when it comes to ESG so don’t be afraid to make mistakes. We hear a lot of stories from businesses who set some ambitious targets, and then miss them. Don’t worry, at least you know you will make some progress and you will be making a difference.
- Know your stakeholders, and what to report to them
When you are reporting ESG progress, it’s really important that you know who you are reporting to, who is your audience and who are your stakeholders. Think about what is relevant to your organisation, what you report against, and what you measure. These factors differ across businesses. If you’re looking for ESG investment then you may be focused on recruiting and retaining staff, or your sustainability plans. Choose your focus based on your business needs and future plans.
Really useful tips and guidance from Trowers & Hamlins. Along with our partners and also our new ESG Business Growth Advisor, Alex Davies, Elephants Child can help guide you through the ESG agenda. We’ll help to create and maintain value for your business.