This chapter presents highlights from the 2020 Global Impact at Scale report, published by Trialogue’s global partner Chief Executives for Corporate Purpose (CECP) and based on data collected by Global Exchange member companies. The report presents survey findings on the environmental, social and governance (ESG) behaviours of 168 global companies, headquartered in 24 countries.
Almost one-quarter of the companies (24%) were headquartered in East Asia and the Pacific, followed by 19% in North America, and 18% in each of Western Europe and Latin America and the Caribbean. Seven percent of the companies were headquartered in sub-Saharan Africa (reflecting the 12 South African corporates surveyed by Trialogue).
The companies were large, with a median revenue of $8 billion (R132 billion). Just over one-fifth of companies in the sample (22%) were from the financial sector, followed by the materials sector (16%) and then discretionary consumer goods (11%).
ESG issues gaining prominence
The report found that global companies expect staff working on ESG issues to rise to more influential leadership positions in the next two years, with over half of companies (59%) predicting that ESG staff would be moving to more senior levels.
Most companies (70%) reported that ESG metrics were incorporated into the performance and sometimes remuneration indicators of at least some of their staff.
Most global companies (84%) said that the collection of ESG data had improved their operational efficiency, while over half (52%) said that it had helped them attract a new generation of empowered workers. Another stated benefit of ESG reporting was a decline in resource dependency (37%). Only 3% said that it was not helpful at all.
The survey asked about the importance of various ESG issues, including the future of work, healthy lifestyles, diversity and inclusion, human rights, and arts and culture.
The future allocation of resources across these issues indicated that ‘healthy lifestyles’ and the ‘future of work’ were likely to receive the most attention from companies in future, with 61% of companies reporting an increase in the amount of resources for both of these issues. Diversity and inclusion came third, with 59% of companies projecting an increase in resources for this issue.
ESG expenditure increasing
In line with the increasing importance of ESG issues, respondents reported an increase in resources for ESG-related functions. Most companies (85%) reported that resources set aside for environmental issues were likely to rise and none reported an expected decline.
Over two-thirds of companies (68%) reported that resources for social issues, including human resources and staff wellbeing, were rising and no companies reported a decline in resources for social issues.
When asked specifically about projected social investments over the next two years, 59% of global companies said expenditure would remain the same, while 31% said there would be a meaningful increase in resources and budget for social investment.
In South Africa, a similar portion of companies surveyed by Trialogue (61%) expected expenditure to remain the same in real terms, but fewer (only 16%) expected an increase above inflation. The remaining 23% expected a decline in real terms.
Frequent use of foundations for international giving
Over two-thirds of global companies (69%) have at least one foundation or trust, and on average 3.3 foundations or trusts. According to the CECP, a trust or foundation is often set up for international social investments as it can be more efficient, easier, allow the company to expand philanthropic contributions through a legal or fiscal framework, and is closer to local beneficiaries and stakeholders.
By comparison, Trialogue found that fewer South African companies managed their corporate social investment (CSI) through a trust (30%) or a non-profit company (20%). Very few South African companies (11%) gave internationally, which is where many of the global companies used trusts or foundations, with 48% of global companies reporting at least one international grant.
SDGs a common framework for companies
According to Global Impact at Scale, the Sustainable Development Goals (SDGs) have become a framework for sustainability at a global level that has increasingly been adopted by corporates. This observation was supported by the results of the survey, which indicated that four out of five global companies (81%) were aligned with the SDGs to some extent: either frequently as part of their overall company strategy (47%) or somewhat frequently using the SDGs as a framework for reporting or to measure social investment (34%).
Trialogue’s South African survey results also point toward the incorporation of the SDGs as a framework for social investment, with the same proportion of companies (81%) reporting alignment: a higher 59% reported frequent alignment to the SDGs through integration in the overall organisational strategy and one-fifth (22%) reported somewhat frequent integration of the SDGs.
The Global Impact at Scale report found that 78% of companies included the SDGs in executive level reporting. A further 15% of companies would consider including SDGs in executive level material. The South African companies in Trialogue’s survey reported slightly greater alignment, with 80% of companies including the SDGs in their reporting to executives.
Almost four out of ten companies globally (37%) reported using the SDG framework for social reporting. Around half of South African companies (48%) reported using the SDG framework for CSI measurement to at least some degree.
Private-sector collaboration gaining momentum
The global survey identified that greater private-sector partnerships and collaboration were having an influence on CSI strategies and that companies were increasingly pooling their skills, talents, and resources to solve societal problems.
Three-quarters of global companies reported including partnerships either in their company (29%) or departmental strategies (46%). Most corporates (58%) were already including partnerships with other private-sector companies in materials presented to senior executives in 2019, up from 36% in the previous year. Only 3% of corporates reported that they did not have private-sector partnerships.
Growing employee volunteering
The average volunteer participation rate among global companies was 22% and was highest among companies in the financial (30%) and energy (29%) sectors. Trialogue’s survey reports on South African participation rates per type of intervention – the highest being for company-organised volunteering days in which an average 35% of employees participate.
Global companies offered a median of 16 hours (two days) of employee volunteer time per annum, with companies most commonly (29%) offering eight hours of volunteering. Of the 49% of South African corporates that offered volunteering time, the median amount of time was eight hours (one day), which was offered by 41% of the subset.
Just over half of global companies (52%) offered at least one matching gift programme with an average employee participation rate of 26%, and a median participation rate of 12%. Similarly, almost half of South African companies (49%) offered matching gift programmes, at a comparatively lower average employee participation rate of 10%.