NAVEX Survey Finds Companies Adopting ESG Practices, But Lack Confidence in Sustainability Performance
A survey of managers and senior executives at companies with 500 employees or more, released by risk and compliance management software company NAVEX Global, found the vast majority of companies have put ESG initiatives in place, but many lack confidence in their sustainability performance.
The study was conducted by OnePoll in December 2020, surveying 1,250 management and senior level executives in the U.S., U.K., France and Germany, regarding the ESG practices at their companies.
According to the survey results, 81% of respondents reported that their companies have formal ESG programs in place. Publicly traded companies were the most likely to have ESG initiatives in place at 88%, followed by 79% of venture and private equity-backed companies, and of privately-owned companies.
Bob Conlin, NAVEX Global CEO, said;
“ESG has continued to grow in importance, with multiple stakeholders exerting pressure on organizations to address issues related to corporate, environmental and social responsibility. While global standards and regulations are still nascent, businesses aren’t waiting. They recognize that prioritizing ESG is an investment in competitiveness and future success.”
Despite the high prevalence of formal ESG programs and initiatives, however, most respondents appeared to lack confidence in their companies’ actual sustainability performance. Only 50% of respondents said that their company performs very effectively against environment metrics, 39% rated performance against governance as very effective, and only 37% with respect to social issues.
Other key findings from the survey include:
- Regional differences. European countries lead the U.S. on the implementation of ESG reporting. 85% of respondents from both France and Germany said they have formal ESG reporting processes in place, followed by the U.K. at 82% and the U.S. at 74%. In all regions, respondents reported that “Environment” represented the most important aspect of ESG in terms of business reputation, followed by “Social” and “Governance.”
- Generational differences. 64% of millennials at companies that did not yet have formal ESG programs in place believed that they should, compared to 55% of 40-55 year-old (Gen X) respondents, and only 36% of those over 56. 45% of millenials said ESG ratings would influence their stock buying decisions, compared to 37% of Gen X respondents and 36% of older respondents.