Over 75% of Czech companies engage in non-financial ESG activities

by   CIJ News iDesk III
2022-10-06   09:58
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Environment, social feeling and transparent management – ​​these three components are the basis of the recently mentioned ESG concept. A survey conducted by the Ipsos agency for the law firm ROWAN LEGAL indicates that this is an issue that is currently being addressed by more than 75% of Czech companies and trading companies. Although these targets are mandatory for now, especially in the banking and financial sector, in the future it is expected that the obligation will be extended to other large and medium-sized enterprises as well. In such a case, over 50% of companies are inclined to use the services of professionals from law or consulting firms for the effective implementation of ESG solutions.

More than three quarters of companies are engaged in ESG.

A survey conducted for one of the largest Czech law firms, ROWAN LEGAL, by the agency Ipsos shows that more than three quarters of Czech companies attach importance to ESG in their business. At the same time, the greatest emphasis is placed on it by companies that are relatively new on the market - from roughly one to five years. For about 30% of companies, social and societal benefits are the most important, which is comparable to the share of companies that, on the other hand, implement ESG in order to make management and company management more efficient. For 23%, environmental protection is the most important factor. Only 16% of respondents state that all three areas are equally important to them.

"Czech companies are also beginning to realize that non-financial activities are also very important for business. At present, banks and credit institutions are obliged to address ESG, but in the foreseeable future it will affect practically all companies. That is why many of them are already actively interested in ESG In reality, it takes different forms - for example, they introduce compliance programs, anti-bribery training or questionnaires on gender equality, diversity and inclusion. We see this trend as positive and it will make things much easier for companies after the new legislation has already they don't give a choice," comments Michal Nulíček, partner of the law firm ROWAN LEGAL, on the current situation.

A number of the approached entities are struggling with ways to effectively integrate ESG into their operations. Evidence of this is the willingness and openness to the possibility of hiring an external supplier to create a customized ESG transition strategy for them. Such a solution is acceptable for more than half of the companies and it is mainly preferred by medium-sized companies with the number of employees from 250 to 499. Among them, roughly 67% of the survey participants would welcome such an option. On the contrary, only less than 10% of respondents strictly exclude this possibility.

Companies are dedicated to ESG, even if they are not obliged to for the time being.

The ESG concept stands on three pillars symbolized by three letters in the abbreviation. The first of them is an environmental approach and an emphasis on environmental protection - in this direction, the main topics include energy efficiency, reducing emissions and pollution levels, circular economy and biodiversity protection. In the social area, topics such as human rights, safety and health protection at work, equality between women and men, inclusion, diversity and support of community and non-profit projects play an important role. The last pillar is the management of companies for which the active fight against corruption, the protection of whistleblowers, the prevention of conflicts of interest or the composition of company management are important.

The transition to ESG offers many opportunities, but it also brings some risks. On the one hand, companies can improve their internal company culture, and it is also a significant marketing opportunity. Fulfilling ESG goals can also be a suitable opportunity for companies to reach new employees, especially from the youngest generations, who attach increased importance to these topics. On the other hand, the introduction of ESG can be complicated by external influences, and a significant risk is the situation when the internal practice in the company deviates from the presented values. In such a case, companies face a serious reputational risk.

"A prerequisite for an active grasp of ESG, including appropriate marketing, is a clear agreement on the parameters of a specific project and a general willingness to make time- and logistically demanding changes. But luck favors the prepared - companies that are already active in this direction create good marketing conditions from the point of view of," concludes Michal Nulíček.

The public opinion survey was carried out by the Ipsos agency for the law firm ROWAN LEGAL during August 2022. The representative sample consists of 200 representatives of companies that stand in the various positions in top management in their organizations. Small, medium and large companies were approached. Their composition is similarly diverse in terms of time on the market, as it includes both relative newcomers and traditional entities.

Source: ROWAN LEGAL and CTK