The global metric for this social threshold is 'Countries scoring <0.5 in the Voice and Accountability Index'. Nearly 2/3 of countries* score below the threshold and little has changed in the past 10 years.
Voice and accountability capture perceptions of the extent to which a country's citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free media. Businesses thrive in peaceful circumstance with effective institutions. Political environments which are unstable and unrepresentative present a risk to this expected operating norm. In addition, corruption causes inefficiencies in markets and hampers responsible businesses’ ability to remain competitive.
For the past seven years, Article 13 has reviewed how the world’s largest 240 companies assess their performance and impact against our planetary boundaries and social thresholds. This year, one area for focus was how companies support the social threshold of ‘voice’. In the context of corporate behaviour, ‘voice’ can be viewed as the mechanisms and behaviours which support employees and supply chain personnel to express their opinions and desires in relation to the company’s performance.
Of the businesses we reviewed, just 5% of companies have explicit publicly disclosed annual measures to monitor their impact associated with employee ‘voice’. These include employee surveys, whistle blower mechanisms and audits, but these exclude the wider scope of personnel involved in their supply chains.
2.5% of companies have published external, explicit targets to enhance employee voice. Where targets have been identified, they typically focus on compliance with human rights and considered quantitative assessments of employee engagement. Example target metrics include:
- Employee survey completion rates
- How long grievance / complaints resolution take to resolve
- Number of employees covered by collective bargaining agreements
- Quantity and quality of training on human rights and ‘speak-up’ initiatives
- Supplier codes of conduct which include human rights / employee grievance mechanisms
If the World is to meet its social foundation target for ‘voice’, all companies need to measure their impact and set targets for enhancement for both direct and indirect employees.
With requirements for companies to report against topics such as slavery (e.g. the UN's Guiding Principles on Business and Human Rights, UK Government Modern Slavery Act) and with increasing attention on topics such as employee diversity (e.g. Gender Parity Gap), corporations around the world are facing the challenge of hearing the ‘voice’ of employees in their supply chains.
The challenge ahead is to develop new tools to engage and empower employees. Whilst supply chains are becoming ever more remote, the rise in digital communication provides innovative new ways for collecting feedback and building global dialogue.
One of the biggest challenges lies with communication. All too often this can get forgotten after the big bang of the initial announcement. People need ongoing communication in the form of progress updates and forums to share learnings. Creative techniques such as info-graphics or storytelling will make your communications more engaging, as will the use of language and relevant soundbites that everyone can identify with. Make sure the whole workforce is engaged including those that work remotely. This means exploiting all communication channels available to you from marketplace style gatherings to email bulletins and public area posters and digital screens.
What is clear from our research is the increasing importance for organisations to listen and understand the voices of their stakeholders. Not just the 'loud' voices, but also the voices of those traditionally under-represented. Without a formal facility for voice to be heard, the rise in power of informal channels such as social media could prove harmful to corporate reputation.
For the corporate sector to play its part in the achievement of living within our planetary boundaries and social thresholds - it must address its real impact on the planet’s resources and social thresholds and base targets on what the world and society needs them to do.
If you would like to know how Article 13 can support you to measure your impact on Planetary Boundaries and Social Thresholds, get in touch.
*The Globaleconomy.com 2017
How companies were selected:
Companies were selected according to four factors to ensure a representative sample size. Ability to impact planetary limits (e.g. largest companies globally by revenue); Public commitment to sustainability (e.g. constituents of sustainability leadership rankings such as Corporate Knights); Representatives of largest companies by regional stock exchange and by super-sector listing. Representatives by geography (largest companies for different regions: Europe, Middle East and Africa, North America, South America, Asia and Australia).
Planetary boundaries and social thresholds:
Planetary boundaries: In 2009, Johan Rockström and 28 scientists identified the nine processes that regulate the stability and resilience of the Earth system. They proposed quantitative planetary boundaries. Crossing these boundaries increases the risk of generating large-scale abrupt or irreversible environmental changes.
Social thresholds: In 2016, Kate Raworth (Oxfam) combined the nine planetary boundaries with twelve social thresholds, which set out quantifiable basic needs for all people. The planetary boundaries and social thresholds were key scientific inputs to the UN Sustainable Development Goals. https://www.article13.com/d-is-for-doughnut
Sources of data used:
Latest company CSR/Sustainability Report or disclosures to the CDP. The most recent published values were used, for the majority of firms this was the 2018 values, however occasionally the companies’ 2018 data was unavailable and 2016/2017 values were used.