NTICS Notes > ESG FOCUSED ON THE ‘S’: HOW TO INCREASE SOCIAL RESPONSIBILITY INDICES?

ESG FOCUSED ON THE ‘S’: HOW TO INCREASE SOCIAL RESPONSIBILITY INDICES?

Understand how your company can increase ESG indexes with a focus on S, through projects to the community.

Environmental, social and governance standards have become the focus of companies’ attention since the pandemic caused by the Covid-19 virus emphasizes the importance of social factors that were not so considered before. There are steps that organizations can take to improve ESG and sustainability performance, while demonstrating how to apply and disseminate their values ​​to the community in which it operates and society.

In the past two decades, the definition of Environmental, Social and Governance (ESG) standards and their role in the company’s value and business strategy have evolved from a topic of discussion to an urgent demand. In many places, the implementation of tangible plans and reports has evolved becoming an important part of the company’s strategic agenda.

The way the company uses its ESG structure to create value continues to promote dialogue inside and outside the board of directors because this is no longer a voluntary position for the organization, but it is becoming increasingly necessary as a competitive differential and demanded by consumers and investors. Regarding environmental issues, such as climate change, international agreements and national policies are deliberately promoting the transformation of the global economy. Governance is also evolving due to the need to demonstrate transparency and process monitoring.

However, for “S” social factors, the business approach is still a little different. While some sectors have a supply chain and a clear business footprint and have long emphasized security or respect for human rights, other sectors define society as valuing communities or companies. As FTI Consulting’s corporate governance experts recently established, the widespread use of the term “society” can lead to a failure of understanding the “S” in ESG, leading to a lack of focus and scale in the market.

Today, ESG policies play a key role in the company’s decision-making process. In 2019, an estimated $ 70 billion was invested in ESG funds. The fact that ESG investment is expected to reach $ 50 trillion in the next two decades confirms that this pattern has become popular. These factors are no longer just “easy to control”, but an important part of the company’s performance and assessment.

Unlike the “E” and “G” factors, the “S” issue is often difficult to define on the company’s agenda and covers a variety of issues that vary from department to department, from donations to the community to human rights issues. Their impact and value are often difficult to quantify, but if used improperly, causes irreparable damage to the interest groups’ long-term reputation and value.

Expectations and the focus of investors and other market participants (such as credit rating agencies) on the “S” factor will continue to improve as all interest groups continue to evaluate the company. The business environment is rapidly changing and this new normality offers an opportunity to focus attention on improving social issues with stakeholders, from employees and regulators to customers and suppliers. However, as ESG issues are interrelated, companies cannot ignore their environmental and governance efforts.

How to improve “S” – SOCIAL indexes?

For 18 years NTICS Projects aims to develop and implement projects that promote change processes, contributing to a transformation in society and the world. The projects can be financed through incentive laws or marketing budget, by companies that wish to leave a legacy in the community in which they operate by working on the UN Sustainable Development Goals and increasing their social responsibility indexes.

All projects seek to maximize and enhance reach by serving as many people as possible and delivering opportunities, through education and knowledge. At the end of each project, the sponsor receives a report with an analysis of the indicators that can later be reported in the company’s annual sustainability report, increasing ESG indexes, especially the S – with a focus on responsibility and social development.

The projects also aim to engage the city so that local and governmental organizations align themselves with the Sustainable Development Goals by signing the Agenda 2030 commitment term. In addition to investing in a project for the local community, the company will also be the main incentive for the legacy to extend to cities as well.

“It is inspiring to feel the changes happen, to watch realities change course. It is what drives us to achieve greater results for the organization, for our partners, and for society.” – Ana Carolina Xavier, CEO NTICS Projects.

Do you want to understand how your company can be more active in the social development and responsibility movement? This initiative increases ESG rates with a focus on “S”- social, proving that the company is truly engaged with sustainability. Get in touch and discover alternatives to work for a purpose. Whatsapp or e-mail: contato@ntics.com.br