Environmental, Social & Governance (ESG)
What is ESG?
Environmental, Social, and Corporate Governance (ESG) refers to the three central factors in measuring the sustainability and societal impact of a company or business.
- Environmental concerns include climate change & sustainability.
- Social concerns include diversity, human rights, and consumer protection.
- Corporate Governance concerns include management structure, employee relations, executive compensation, and employee compensation.
Climate Change - the Board's responsibility
Boards are charged with safeguarding the long-term well-being of their organisations, and delivering value to students. We know the Further Education and Skills (FE) sector isn’t just about ‘delivering’ qualifications but that it has far-reaching environmental, social and economic impacts. Boards that embrace this will be in a far stronger position to be at the forefront of change as well as attract students and investment as society becomes ever more sustainability conscious.
The board is ultimately accountable to stakeholders for the long-term stewardship of the organisation. Therefore, the board should be accountable for the organisation’s long-term resilience with respect to changing operating landscapes i.e. from climate change. Failure to do so may constitute a breach of trustees’ duties.
A Climate Road Map for FE Colleges was launched in 2020. The Climate Action for UK FE Colleges Roadmap has been developed in collaboration between Climate Commission and award-winning management consultancy, Nous Group. The Roadmap provides clear actions and guidance on how colleges can respond to the climate emergency and advance sustainability. The map, together with webinars for governors and staff, can be found at the link above.
The ESFA have published non-statutory guidance on reporting of various environmental matters. Boards should be seeking comprehensive reporting on these as a minimum, together with other issues contained under ESG. A framework for a Social Responsibility and Sustainability Annual Report to the Board is available to download below.
Social Responsibility and Sustainability Annual Report template
Sustainable Development Link Governor
Further Education is uniquely placed to bring about transition and transformation in our society. The sector reaches millions of students, staff, and many communities in every town and city across the country. Crucially FE is the pipeline for the workforce of many industries, employers, and sectors who have a critical role to play in sustainable development. There are many areas for a link governor of sustainable development to consider:
* That FE leaders, teachers, and professional staff are using education to meeting society's sustainable development needs
* All learners are explicitly sustainable learners
* FE develops specialist sustainability skills to enable the green transition
* Education for sustainable development is being embedded in all curriculum areas and other student activities
* ESD is inclusive
* Net zero or regenerative infrastructure is use as part of the learning journey as well as to 'house' education
* FE institutions have positive impact in their communities to enhance sustainable development
A sample role description to support the governor who is linked to this area, is available for download below.
Creating a sustainability-savvy board
In this podcast, I discuss with Charlotte Bonner (National Head of Sustainable Development at ETF) the definitions of sustainability and education for sustainable development, alongside the role of the Board in oversight of this topic. Charlotte gives insight into good practice within the FE sector, what is driving this practice, and where Boards can go to find out more.