ESG, which stands for “environmental, social and governance,” is making headlines these days, yet many small businesses might feel it’s the domain of large companies only – those that have the funds and resources to devote to complex programs.
The great news is that responsible businesses of any size can make a difference through some tweaks to their processes, with a positive impact felt throughout the organization. In fact, a Google Cloud survey found 86% of executives believe their ESG-related endeavors are making a difference, and nearly three-quarters say sustainability can drive powerful business transformations.
Are you ready to get more involved in ESG-related issues? Here are some changes to consider in each of the three ESG categories to start being more socially responsible today.
Revving up environmental efforts
1. Enact simple changes to save energy. You can swap outdated light bulbs for more eco-friendly types, such as LEDs; deploy motion sensors to get the illumination you need without keeping lights on unnecessarily; use power strips to make it easy to switch off office machinery when it’s not in use; and keep thermostats at an even temperature.
2. If you are a service-based business that makes calls to clients’ homes or offices, schedule appointments planfully. Rethinking your traffic patterns and arranging trips that are in close proximity to avoid backtracking saves fuel – and time.
3. Talk to your suppliers about options for reducing the toll taken by frequent shipping and excess packaging. You might find you can reduce both by buying in bulk, which can also often save money through volume discounts.
4. Get creative in finding new ways to reuse and recycle components of your process. For example, you might find there’s a market for leftover wood, steel and other materials if you’re a fabrication business. Restaurants can find ways to reduce food waste by tweaking recipes to use the same ingredient in multiple dishes and carefully managing inventory.
5. Allow hybrid work arrangements when appropriate for your line of work. It saves on office energy use and cuts down on the negative environmental effects of commuting, while often making your workplace more appealing to talent.
Making social strides
6. Research your suppliers and consider buying from BIPOC- or women-owned companies or those that otherwise align with your values. To start, check out these reference lists the U.S. Chamber of Commerce has assembled for Black-owned businesses and women-owned businesses.
7. Consider DE&I (diversity, equity and inclusion) principles when hiring new team members. Use inclusive wording in job postings to promote a welcoming environment and commit to interviewing a diverse slate of candidates.
8. Honor diverse cultural celebrations, such as Juneteenth, Asian-Pacific Heritage Month and Native American Heritage Month. Ask employees to share personal stories as appropriate or solicit volunteers to research relevant traditions.
9. Create employee resource groups that allow for open dialogue. Depending on the size of your company, they can extend beyond cultural or gender parameters to include other affinity types, such as “parents of school-age children,” book lovers or any designation that your employees suggest to help build cross-team bonds in a variety of ways.
10. Encourage volunteering either as individuals or a group. Many businesses allot their team a designated number of paid hours to devote to the activity of their choice. Alternatively, finding a group activity to support can help build camaraderie and a shared vision.
Advancing governance gains
11. Connect with peers in your industry and others to share best practices. Consult with local industry or regional groups you’re part of to see if they have an ESG-focused committee. If not, you can volunteer to start one to establish yourself and your business as thought leaders.
12. Hold company-wide “town hall” meetings where team members can ask questions and make suggestions through open dialogue with company leaders. Make sure to capture the conversation and circle back to answer questions and show progress on issues that are raised.
13. Research your company’s pay equity by gender, race and other factors. If you see discrepancies, determine action steps to move toward ensuring all groups are being paid fairly and equally. Not only is it the right thing to do, but it can help with employee engagement and retention.
14. Develop channels for communicating your ESG initiatives and progress to all stakeholders, including your board of directors, investors, employees and customers. Detail your achievements on social media and put together a regular newsletter that showcases your work and the individuals supporting it.
15. Remember the adage “what gets measured gets managed” and incentivize your team to measure their progress around ESG criteria. Celebrate steps toward improvement, no matter how small.
Small changes create long-lasting impressions
As you can see, there are myriad ways you can promote ESG factors, no matter the size or scope of your business. Wherever you choose to apply your efforts, recognize that micro steps lead to macro impacts, and the most important thing you can do is start somewhere.
A commitment to ESG stewardship is one way you can differentiate your business from peer companies and help you retain talent and attract new customers – while also saving costs and improving our environment.
Do you want to know more about how Valley Bank helps companies with their ESG initiatives? Read more about our experience here. [Can we link to the other stories in this series when complete?}