Member Article

You can’t fool us! Employees dubious about their companies’ ESG credentials

New research from Advanced reveals 43% of employees think their company has been guilty of greenwashing – and 18-24 year olds are more cynical about their employers’ environmental efforts

43% of senior employees in the UK think their company has been guilty of greenwashing. This is according to a new report from British software and services provider Advanced, which also reveals that employees believe their bosses are prioritising increasing profit (47%) over hitting environmental targets (37%).

Environmental, Social and Governance (ESG) issues are no longer a niche concern. As mandated in the Climate Change Act 2008, the UK is tasked with reducing its carbon emissions by 80% before 2050 – and businesses have a major role to play. There is also a growing awareness in business that being greener helps organisations build a reputation for doing the right thing, creating a positive effect in the world, as well as giving them a considerable competitive edge. However, the new findings from the Advanced 2021/22 Trends Report, which questioned 1,078 employees, suggest that many are simply paying lip service – and environmentally-savvy employees will call them out.

The research also shows that young people in particular are cynical about the actions their organisation takes credit for. According to the report, 56% of 18-24 year olds say their company has been guilty of greenwashing (compared to the 43% for all). They also seem to have a better handle on environmental issues with 83% of those aged 18-24 saying they understand their organisation’s carbon footprint, compared to the average for all ages, at 69%. This suggests that young people want to align themselves with companies that are doing the right thing for the planet and society, and are working towards positive change.

Gordon Wilson, CEO at Advanced, says: “Environmental issues matter to everyone, but the young have a vested interest and care about working for an organisation that wants to make a positive impact on the planet. Having a solid ESG policy with strategies to ensure it is delivered is essential for attracting employees – as well as customers and investors – and for helping build confidence from suppliers and other stakeholders. It’s time for all businesses to get ahead of the curve on this issue, as the UK government can, and will, begin to stamp down on businesses that are found to be greenwashing.”

In September, the Competition and Markets Authority (CMA) warned businesses they have until January 2022 to ensure their environmental claims comply with the law. It also published the Green Claims Code to help firms stay on the right side of the law.

Some progress, however, is being made. Nearly half (47%) of businesses, according to Advanced’s survey, are educating staff and customers about the measures their organisation is taking to reduce their carbon footprint. More specifically, 46% are increasing their efficiency of lighting, 41% are switching to green energy providers, and 38% are working with suppliers to reduce usage. A third (34%) are downsizing their offices, while 32% are purchasing carbon offsets such as planting trees.

Gordon adds: “There is still a long way to go if we are to reach the UK’s ambitious climate target and, like many businesses, Advanced is on a journey to reduce its carbon emissions. We invested in an ESG reporting tool a year ago and, as a result, have been able to see the results of the last two years of initiatives measured against our overall greenhouse gas emissions – from all our offices, travel and data centres. We have since renovated our offices to minimise our energy consumption, switched to green energy providers and installed energy charging stations to encourage the use of electric cars.

“We have made good progress at Advanced, but every business, including ours, needs to hold each other accountable and push further to ensure lasting change for us all. Our key goals are to reduce our entire carbon footprint, run our operations on 100% renewable energy, achieve carbon neutrality and do our part to contribute to a sustainable future.”

Other key findings from the report include: • 37% say ESG is a business priority for the next 12 months – up from 21% last year • 59% are now using software to measure ESG performance • 28% say they rely on carbon footprint tools in their daily working life • 47% of respondents say the most important attribute for a business leader is encouraging positive environmental practices.

This was posted in Bdaily's Members' News section by Advanced .