Concerns are being raised by corporates that charities are not committed enough to environmental, social and governance (ESG) issues, a report is warning.

Just a quarter of corporates believe charities have “holistic ESG plans and frameworks in place”, according to the report. Corporates’ view of charities’ ESG commitments has fallen by 17% over the last year, it added.

This concern is backed up by charities, with less than half believing their sector has such firm ESG plans in place.

“This perception that non-profits’ approach to ESG falls short of stakeholder expectation represents a clear risk to the sector,” warns the report by C&E Advisory Services into corporate and NGO partnerships.

“Whilst many non-profits have focused, core social and environmental missions, it is often not evident how effectively NGOs perform on wider ESG issues”.

A fear raised in the report is that while activities by charities may achieve societal change, they may also have harmful environmental effects “and vice versa”.

“For NGOs and non-profits, being perceived as a deserved paragon of virtue in one regard may not be enough to defend against criticism in an unrelated area,” said the report.

“There is therefore an imperative for non-profits to think holistically about the importance of the ESG agenda for their future evolution – and to demonstrate and communicate that holistic approach.”

Among partnerships taking place, almost all business and charities said such link ups have helped corporate partners understand societal and environmental issues. Around half of those in both sectors say it has changed their business practice for the better.

The most admired corporate partnership by those surveyed is between Tesco and WWF, replacing last year’s most admired Boots UK and Macmillan Cancer Support.

WWF and Tesco began working together in 2018 and has aims including halving the “environmental impact of the average UK shopping basket”. This takes in issues including climate change, sustainable diets, deforestation, food and packaging waste and sustainable agriculture.

Cost-of-living crisis

The C&E Corporate NGO Partnerships Barometer found that such link ups will become “more important” over the next three years, particularly in supporting communities amid the cost-of-living crisis.

Almost nine out of ten of corporates and charities say the crisis will feature strongly to moderately in their partnerships.

Two thirds of corporates and charities say accessing low income and “hard-to-reach” communities is a key aspect of the partnership.

This is a “strong acknowledgement that the impact will be felt hardest in low-income groups”.

Share Story: