What Does ESG Mean to Your Business? Part 3: People

What Does ESG Mean to Your Business? Part 3: People

ESG refers to business leader’s focus on Environmental, Social and Corporate Governance in relation to their long-term plans. What can a focus on ESG mean to your business or profitability, and how can companies use employee engagement tactics to further the cause?

In 2017, over 140 CEOs from the World Economic Forum International Business Council (IBC) issued a “Compact for Responsive and Responsible Leadership”. The CEOs developed a framework that companies can use to track and demonstrate long-term sustainability. This compact aligns corporate goals to the long-term goals of society and identified “Sustainable Development Goals” (SDGs) as the roadmap for that alignment.

In our February and March blog posts, you’ll find an overview of the 4 pillars of ESG, and what they can mean for your business.

The 4 pillars of ESG that will be covered in this series of 4 blog posts are:





Part 3: People

Companies are realizing the benefit of shifting focus from providing solely shareholder value to stakeholder value. Successful companies understand that not only is environmental responsibility the right thing to do, but it’s one of the factors that retains key employees. Today’s employees want to know that the company they work for shares their values in terms of diversity and inclusion, social and environmental responsibility, ethics and more. Furthermore, both employees and consumers expect companies to fill the void left by government.

Companies with highly engaged employees realize a host of benefits including increased productivity, lower absenteeism, lower healthcare costs, lower turnover, increased market share, profitability and more. Gallup reports that on average, 35% of U.S. employees are fully engaged in their work. Conversely, 15% are actively disengaged; they’re actually harmful to the brand. In fact, it is estimated that disengaged employees cost business between $450 and $550 billion per year.

What’s the answer? Studies continue to show that highly engaged employees feel recognized and rewarded for their accomplishments. Properly structured incentive, reward and recognition programs not only ensure that employees are objectively recognized for their work, but these programs are critical vehicles in communicating company goals and values. It is imperative to work with experienced professionals in designing employee programs. An experienced firm can guide you to the most effective rewards (spoiler alert: tangible and experiential rewards produce higher gains) and avoid unintended consequences that are possible when companies try to design programs in house.

It has long been said that employees don’t leave companies…they leave managers. This is quickly changing as employees expect their company’s values to align with their own – and that the company will “walk the talk”.

To learn more about how ESG impacts employee engagement, view our latest webinar:



In economic terms, the multiplier effect refers to the proportional increase or decrease in final income that results from an injection or withdrawal of capital. In terms of Safety Reward Programs, the multiplier effect might refer to the ROI² (Return on Incentive Investment). A properly structured program significantly impacts overall employee engagement and safety culture, where employees are attuned to safety-related issues, inspired to display “Above & Beyond” safe behaviors, willing to be safety ambassadors, and encouraged to promote learning and support continuous improvement. Such best-in-class programs are designed to promote group objectives and reward individual behavior, engaging, motivating, and rewarding the people behind your success.

Fortunately, there are thousands of companies in high-risk industries that have excellent safety programming, training, and coaching in place. Many include safety in their list of core values and have invested heavily in EHS (Environment, Health, and Safety) technology, training, telematics, and personnel. However, too many miss the opportunity to incentivize and recognize individual safety contributions, behaviors, and performance.

Programs featuring tangible and experiential awards as the reward currency can have a multiplying effect that pays dividends. Benefits include a more highly engaged workforce, fewer accidents and incidents, reduced claims and losses, lower turnover and absenteeism, better communication, increased productivity, visibility to leading and lagging indicators, incremental coaching and training opportunities, and improved profitability.

So, what’s the rub? Are engagement programs focused on employee safety, health, and wellness expensive to implement? Do they only make sense for companies with thousands of safety-sensitive workers? The answer to both questions is no. Properly structured programs can be cost-effective and right-sized for companies with as few as 100 safety-sensitive workers up to those with 10,000 or more. The ROI² of these programs can be expressed as a ratio (in this case, 4:1), with quantitative results showing a savings of $4.00 for every $1.00 invested and qualitative results revealing higher employee morale, which serves as a catalyst for productivity. Safety Reward Programs help to mitigate risk, elevate employee engagement, and improve overall safety culture. They also present an excellent opportunity for companies to simply say thank you to their employees for being safe, committed, and engaged.

People have an inherent need to know that their efforts do not go unnoticed. Safety Reward Programs provide the stimulus and energy that encourage employees to perform at their best and achieve new heights.



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