Construction is widely regarded as one of the sectors most exposed to ESG considerations. This is most obvious in terms of Modern Slavery, health and safety protections, Anti-Bribery & Corruption legislation, and CO2 emissions. However, in recent years there has been a greater focus on employee diversity and gender pay parity, as well as the social impact of projects.
Publication
01 Aug 2022 ·
United Kingdom
A rapidly evolving arena
2 min read
Governments play a role in disincentivising less desirable ESG behaviours by way of legislation, taxation and fines. ESG reporting obligations are becoming stricter meaning that businesses are required to benchmark and monitor their performance in all aspects of ESG through robust and credible data.
Mark Carney, when Governor of the Bank of England, sagely predicted that “In the future, climate and ESG considerations will likely be at the heart of mainstream investing.” Funders and investors are indeed now actively establishing their own ESG criteria to ensure that their investments are resilient and sustainable in the long-term. For the same reason, ESG criteria is an important part of procurement decision-making in the public and private sectors.
Shareholder, employee and customer activism is also on the rise, meaning businesses are exposed to increased scrutiny and resulting reputational damage if perceived not to be doing enough, or indeed over-reporting or “greenwashing”. Businesses with strong ESG scores are regarded as more strategically resilient and able to anticipate and adapt to risks and opportunities.
Publication
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ESG in Construction - A View from the Market - Round Table
Other resources
CMS has created a guide “ESG: Ten steps to success for construction companies”
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