ompanies need to spend more time focusing on the social responsibility element of ESG, a Tory grandee has said.
ESG stands for Environmental Social and Governance and has become a top priority for corporations in recent years as investors look to put their money into corporations that not only turn a profit, but run environmentally friendly and socially responsible businesses. The environmental aspect has received more coverage and focus in the UK and abroad.
Former economic secretary to the Treasury and minister for women and equalities, Justine Greening, told the Standard that the City needs to go further on the ‘S’, and a move away from traditional Corporate Social Responsibility (CSR) and simple charity donations.
She said: “The ‘S’ is so much more important than giving some money to charity… It is about fundamentally making sure that the way your business operates is spreading opportunity more widely, and is working directly with communities.”
Greening stood down ahead of the 2019 general election
/ Leon NealGetty Images )
Greening, who stood down ahead of the 2019 general election, was the UK’s first gay female cabinet minister. She started out as a City accountant and now runs The Social Mobility Pledge. It is a drive to make workplaces in London and around the country more diverse, and open up chances for disadvantaged young people, and has signed up hundreds of businesses to date.
The former education secretary revealed that the SMP is to launch new initiative The Purpose Coalition next month.
The coalition will bring bosses at top firms including catering giant Compass, Shoosmiths LLP and Direct Line insurance together with London university vice chancellors. Together they plan to formulate new ideas for linking less advantaged and diverse students up with employment.
Their initiatives, together with each company’s “opportunity action plans” on the issue, will be published online for other businesses to utilise.
The former Government minister now runs The Social Mobility Pledge
/ Justine Greening )
Ideas to be explored will include companies helping London universities co-design courses so that students are not just learning their subjects, but also commercial skills to help them step into career opportunities.
Greening said: “As a business you have to have a plan. I think the public has lost patience with companies who talk about it [social responsibility], but don’t actually take action.
“That’s why we are doing the action plans. Hopefully we are raising the bar on what ESG actually means.
“It’s crucial for businesses that they are opened up to London’s diversity, whether it is minorities or white working class young people who live so close to the City but feel like it is miles away.”
The former minister, who lives in Putney, said that the Covid jobs crisis means that the SMP’s work is now more important than ever.
“It has never been more important that the opportunities for young people still available are accessible to all of them,” she said.
“In the Standard last week with the jobs figures and the claimant count we really saw how hard London has been hit… London has to have its own levelling up plan, and it needs to be business led.”