We talk a lot here about safety, and quite a bit about health, but environment—the E in EHS Today—comes in a distant third among the three topics contained in our acronym. You’ll be hearing a lot more about environmental issues here in the months to come, though, and not just because I’ve covered supply chain topics for the past couple decades. What’s become quite clear in recent years is that companies need to focus not just on the health and safety of their employees but on their entire community—their suppliers, customers and end users.
Corporate social responsibility (CSR) reports, which almost every public company produces annually, are scrutinized by shareholders with almost the same fervor as financial reports these days. While companies are still expected to turn a profit, the manner in which they do that is very much part of the ongoing debate on the global rights of citizens to expect companies to leave the planet in at least as good if not better condition than before they set up shop.
Reducing injury rates and workers compensation claims are just part of the expectations for 21st Century EHS managers. The thinking now is that companies need to take responsibility for not only their own employees but for every worker throughout their global supply chain. It’s great, for instance, to have an affirmative action plan at your facility, but how aware are you of the incidence of human trafficking throughout your supply chain? It’s not enough to just provide respirators for your employees; companies are also expected to monitor and reduce and eventually completely eliminate their greenhouse gas emissions to protect their entire community. Holding toolbox safety meetings every morning is definitely a best practice, but before you pat yourself on your back, how often do you evaluate your suppliers’ working conditions?
As you would expect, some industries are better at CSR than others. EcoVadis, a firm that maintains a global CSR risk and performance index involving more than 33,000 companies, evaluates each company in four broad areas: environment, labor practices and human rights, fair business ethics, and sustainable procurement. And the good news, according to Pierre-Francois Thaler, co-CEO of EcoVadis, is that initiatives aimed at tackling issues such as modern slavery, conflict minerals and environmental pollution are paying off. The one area that’s seen the most improvement worldwide is business ethics, particularly when it comes to fighting corruption and bribery, as well as improving information security. In fact, while most EHS professionals are understandably more focused on fire suppression equipment than data network firewalls, cybersecurity is not just something for the IT department to worry about. Cyber attacks and data breaches are today considered some of the leading causes of supply chain disruptions.
“The global progress in business ethics and information security is an optimistic indicator that businesses recognize the importance of data protection and are becoming more aware of security risks that could impact operations,” Thaler points out.
Interestingly, small and medium-sized companies (those with between 26-999 employees) tend to score higher on the CSR index than large companies (employing over 1,000 people). Also, European companies overall do better than other regions of the world.
Although President Trump’s decision to pull the U.S. out of the Paris climate agreement was widely criticized as a move that would contribute to a higher incidence of climate change, the EcoVadis found no evidence that such a thing has happened. The environmental scores for U.S. companies, in fact, improved over the past year.
So what types of companies score best on the CSR index? According to EcoVadis, small and medium-sized food and beverage companies are the overall winner, with an aggregate score of 46.8 (out of 100; any organization that scores above 45.0 is considered to be “engaged”). The group scoring the lowest, on the other hand, were large wholesale and services companies, with an aggregate score of 39.6.
What then should EHS leaders take away from these types of studies? Isn’t there enough work to be done just to protect their employees from every manner of safety hazard that comes their way? Obviously, ensuring the safety of every employee will always be Job # 1 for an EHS professional, but maybe it’s time we take another look at what exactly that word “safety” means. Consider (as the EcoVadis study points out) that 40 million people are victims of modern slavery, and that more than 150 million children are subject to child labor. How well do you really know your employees and their life situations? It’s not just an HR problem, or an IT problem, or a finance problem, or a C-suite problem. EHS leaders already know more than most how to protect their companies and their employees; who better to also be at the forefront at protecting their world?
