In the shared pursuit of reaching net zero, it is important that no one is left behind. As companies embark on their journey towards a greener future, they need to recognise and embrace the pivotal role they play in fostering a just transition. Among the 166 companies engaged for Climate Action 100+ 2022 Benchmark assessments – representing many of the largest global emitters, 73% are not sufficiently prepared to deliver a just transition.
When it comes to the just transition agenda, companies have various aspects to consider, their workforce, customers, local communities and suppliers in the value chain. But, it is important to first understand and meet the needs of the company’s lifeblood - its workforce.
This publication explores five guiding principles in measuring the ‘S’ in ESG across the workforce. As we strive towards a just transition, business leaders need to actively engage the social dimension of ESG and foster an empowered workforce.
The 5 guiding principles
- Employ a structured and adaptive approach
- Human resource as change agents
- Start within the organisational boundaries
- Leverage on existing resources
- Invest in digital technology
Employ a structured and adaptive approach
Any transformation exercise of significance is expected to create disruption. Take the energy transition for instance, where increasing environmental pressures are pushing almost all companies out of their comfort zone in the transition to net zero. A structured approach in integrating social performance metrics is imperative in streamlining the data collation process and producing insightful analysis.
Human resource as change agents
Human resource professionals are key players in managing the workforce life cycle which includes compensation and benefits, workplace safety, compliance and talent management. Hence, they are in a prime position to spearhead and support efforts aimed at measuring the S in ESG across their workforce.
Start within the organisational boundaries
Measuring a company's social performance requires taking into account the perspectives and needs of various stakeholders. As a start, it is important to focus on the wellbeing of those within the boundaries of the organisation itself - the workforce.
Leverage on existing resources
There are opportunities within the existing business workflow. Routine workforce data, especially those collated by the human resources department, may prove useful in measuring businesses’ social performance.
Invest in digital technology
Generating reliable and accessible data for sustainability reporting requires substantial time, effort and investment. Digital technology has the potential to support strategies in social performance measurement.
