The assessment within Boost is that 2023 will be the year of new regulations that arise as market trends, but also as part of legal regulations. In this segment of news, the leading segment is the ESG segment, and the focus is on social responsibility and sustainable development.
In the context of social responsibility and sustainable development, through new business trends, a minimum of1-7 topics are covered, which are an integral part of legally binding non-financial reporting of interested parties and / or certification according to specific ISO standards.
When considering these topics, each institution decides what is more appropriate and for which it has resources (human, financial, marketing, etc.).
In this sense, it is important to distinguish certain topics because the nuances are minimal, although the goal is the same – achieving effective social responsibility and self-sustainability.
Social responibility
Social responsibility is the organization’s responsibility for the impacts of its decisions and activities on society and the environment through transparent and ethical behaviour that:
- contributes to sustainable development, including the health and well-being of society
- consider about expectations of stakeholders
- complies with applicable law and international standards of conduct
- it is integrated into all segments of the organization and is realized in the relationships within it
Activities include products, services, and processes within the area of impact of the institution.
Sustainable development
Sustainable development is a development that satisfy current needs without compromising the ability of future generations to satisfy their own needs. Sustainable development means combining the goals of high quality of life, health and progress with social justice and maintaining the Earth’s ability to support life in all its diversity. These social, economic, and environmental objectives are interdependent and mutually supportive. Sustainable development can be seen as a way of expressing the wider expectations of society.
ESG
Non-financial information is often defined as Environmental, Social and Corporate Management (ESG) information, which refers to the three central components in measuring a company’s sustainability and social performance.
Environmental component: How the company is exposed to risks and opportunities related to climate, lack of natural resources, pollution, waste and other environmental factors and the management of it and the impact that the company has on the environment and climate.
Social component: information about the company’s values and business relationships. For example, social topics include labour and supply chain standards, employee health and safety, product quality and security, data privacy and security, and diversity and inclusion policies and efforts.
Management Component: information about the corporate management of the company. This could include information on the structure and diversity of the Management Board; responses to critical events; corporate resilience; lobbying policies, political contributions, and the prevention of bribery and corruption. ESG reporting is the process of collecting and publishing data on the above components and enables companies to be transparent in communicating the non-financial aspects of their management and performance. Advantages of publishing good non-financial information for companies:
- Increase transparency and strengthen the relationship of trust with stakeholders (employees, customers, suppliers, general public, regulators, banks…)
- Attract and retain a satisfied workforce, improve efficiency and process management
- Improve business reputation, differ from competitors
- Generate positive publicity and exposure in the media.
Read more: NFRD & CSRD – Boost
Integration of foreign workers into Croatian companies and sustainability reporting – Boost
Get ready for CSRD with Simple ESRS – Boost
