‘Social’ – a spotlight on the ‘S’ in ESG
Is the “S” the forgotten letter in Environmental, Social and Governance (ESG) reporting?
It seems that “social” has long played a secondary role to “environment”, and that sustainability is more commonly associated with ESG than anything else. But social impact is an important factor in ESG reporting and it’s necessary for organizations to pay it attention to fulfil ESG compliance.
Here, we shine a spotlight on the social aspect of ESG reporting and discuss how organizations can elevate their management of social factors for ESG, both for compliance and the benefit of society as a whole.
Why ESG compliance matters
At one time, ESG considerations were a “nice to have”. Now, ESG compliance is a “must have”. ESG reporting is the disclosure of information about a company’s operations in terms of environmental, social and governance. And countries around the world have made it mandatory.
The biggest piece of legislation to date is the Corporate Sustainability Reporting Directive (CSRD), which sets a new standard for ESG compliance. The CSRD requires organizations to undertake a “double materiality” assessment. That is, assessing the company’s impact on the world as well as how ESG issues pose risks or offer opportunities to the company.
Is the environment the main focus of ESG compliance?
It’s not surprising that the environment aspect of ESG compliance has gained the most attention. Reasons for this might include:
- Investors are particularly interested in companies that are proactively tackling climate change
- Achieving net-zero emissions is a global target
- Sustainability is a common goal for organizations and consumers
Interestingly, many companies today earmark budgets specifically for sustainability management, but not for safety management. It will be interesting to see whether this balances out as the “S” in ESG compliance gains more attention.
A deeper dive into social factors of ESG compliance
Despite not receiving as much attention as the environmental side of ESG compliance, the social factors are equally important. At its core, the “S” is about human rights and equity. But it also encompasses all social aspects of an organization, including how its operations impact those who work for it, as well as how they impact local communities and wider society.
In terms of mobility, the social factors include giving consideration to how the activities of the organization affect those who drive on company business. In addition, how driver risk is managed and what the organization does to minimize risk to the drivers themselves and to other road users.
Road safety is a global challenge
The World Health Organization tells us that approximately 1.19 million people around the world die each year as a result of road traffic crashes. Between 20 and 50 million more are left with non-fatal injuries. More than half of all road traffic deaths occur among vulnerable road users, such as pedestrians, cyclists, and motorcyclists.
Road traffic crashes are also a work-related issue. Research shows that approximately one in three road deaths involves someone driving for work[i]. That’s why it’s so important for organizations to take road safety seriously and act to reduce risk and negative impact on society.
How data analytics helps organizations manage social aspects of mobility
ESG compliance requires companies to not only measure social impact but also to act and report on it. Quantifying social impact might seem a difficult task, but AI data analytics uncovers insights from driving data that shed new light on the “S” of ESG compliance.
With only their existing driving data required, AI can measure crash probability at the organization and individual driver level. It can also compare risk level to benchmarks including global average, country average, company average and across divisions and teams. The value of this to organizations is that they can be transparent about the potential impact their operations have on society. Even better, they can share what they are doing to reduce it, and report on progress.
Tools to enable ESG compliance
Greater Than offers a range of products that support companies with ESG compliance, including the measurement of “social” impact. Here’s a quick overview:
Crash Probability Score
The Score measures driving risk on a high to low basis. Thanks to the uniqueness of our AI, the score measures the driver influence on road safety, regardless of location or vehicle type. This makes it easy for organizations to benchmark performance across mixed fleets and quickly pinpoint areas for improvement.
Crash Probability Dashboard
For organizations looking for deeper insights, the Dashboard enables organizations to visualize the Crash Probability Score in real time. It makes it easy to observe and track risk level, see trends, and view progress.
Crash Probability Tool
The Crash Probability Tool is an add-on feature used in conjunction with our Crash Probability Score. The Tool is a hands-on product for risk mitigation that makes it easy to view drivers by risk level, see recommended action to reduce risk, and keep a record of progress.
ESG Compliance Package
Our ESG Compliance Package brings together a selection of our products to help companies measure, act, and report on their mobility impact from both a safety and sustainability perspective. We offer ready-made packages or tailored packages to suit our customers’ needs.
We also provide similar products to measure climate impact, in terms of CO2 emissions, EV battery usage and fuel consumption.
[i] Injury risk significantly higher when driving for work
This is just a selection of our products. To learn more about how we can help your organization manage social factors for ESG compliance, please book a meeting with me.
