Report highlights importance of social part of ESG policies

FTSE-100 companies are 64 times more likely to address environmental issues than to discuss poverty in their statements about Environmental, Social and Governance work, according to a think tank report which aims to galvanise employers to do more to address financial wellbeing.

The report from the Social Market Foundation [SMF] found governance issues also receive a lot more attention from big UK firms than concerns about employees, suppliers and stakeholders living in poverty.

The SMF carried out a keyword analysis of the most recent annual reports of all FTSE-100 firms and found that companies put far more focus on the environmental and governance elements of ESG than on their social responsibilities.

The word “governance” appears 176 times on average in an annual report.  “Environment” is typically mentioned 64 times. But “poverty” was mentioned only once on average.

In all, 53 of the FTSE 100 companies made no mention of poverty in their reports, even though all committed to the ESG agenda.

The SMF said the analysis shows that the “S” in ESG is being overlooked, calling on businesses to pay more attention to poverty among their workforce, supply chain, and community. However, searches of company reports by the Times suggest that several companies that made scant reference to “poverty” were active supporters of the Real Living Wage.

The report is part of an SMF project with Trust for London which aims to develop and promote practical ways for business to contribute to action on poverty.

The SMF has set up a Business and Poverty Advisory Panel that will advise on the project which has found 79% of London employers polled agree that “poverty is an issue that impacts the people in the capital”.

Manny Hothi, Chief Executive at Trust for London, said: “Businesses play an important role in tackling poverty in London, especially when we look at the ongoing increases of in-work poverty. It’s disappointing that many companies do not yet see poverty as part of the responsible business agenda. We want to see all businesses in London taking action to tackle poverty, and a natural starting point is by becoming accredited as a Living Wage employer.”

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