Strengthening the People Dimension of ESG

Environmental, social and governance (ESG) is rising to the top of many companies’ priority lists. The growing need for organizations to address evolving stakeholder expectations — including regulators, investors, customers, insurers, employees and even our broader society — make ESG objectives critical to a firm’s overall success. This is especially true when it comes to people.

HR leaders should take a holistic approach to ESG across the entire business value chain. However, focusing on the intersections and interdependencies between associated risks and opportunities can be challenging. For example, climate change is not only an environmental issue. It also affects financial and physical health and overall wellbeing, with different outcomes based on people’s gender, age, ethnicity, socio-economic status and location.

In order to develop a comprehensive approach to a company’s ESG journey, HR leaders need to consider three key dimensions:

• The external dimension - How your organization conveys its core values and commitments, and how its disclosures impact its ESG ratings
• The internal dimension – How you connect ESG goals and commitments to action
• The perception dimension – How well you communicate ESG plans to employees to avoid any misconceptions

Watch this video for more insights on an effective people approach to ESG:

Want to make better ESG decisions? Learn more about how Aon can help your organization.

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