You’ve probably come across the term ESG – Environmental, Social, and Corporate Governance – which has become the buzzword in today’s business landscape, permeating organisational agendas globally. Governments have also recognised its significance, integrating ESG into legislation and procurement policies. Take, for instance, the recent mandate by the UK Government requiring a minimum 10% weighting of ESG objectives in all government tenders, with severe penalties for companies found misrepresenting their ESG credentials.
Research by Nutral Ethical Workforce Services uncovered some surprising facts: while 75% of tier 2 subcontractors within a project’s supply chain have social sustainability strategies in place, a staggering 58% fail to measure or record the impact of these initiatives. Similarly, while all companies claim to have Equal Opportunities, Diversity, and Inclusion (EDI) policies, only a third are actively measuring diversity within their organisations.
This discrepancy underscores the need for refined supply chain practices to provide tangible evidence of driving social sustainability throughout all tiers of the supply chain. The market’s increasing emphasis on Social Sustainability as a criterion for winning contracts is evident, with housing association Peabody now weighting Social Value at 20% in their evaluations.
What’s particularly encouraging is the involvement of small and medium-sized enterprises (SMEs) within these supply chains, comprising 82% of tier 2 subcontractors. Despite their size, 75% of these SMEs are actively measuring their carbon footprint, showcasing their ability to adapt to the evolving demands of today’s world.
