Better Business / Member news
Burges Salmon announces results from business ESG survey
The drive toward robust environmental, social, and governance (ESG) standards in business faces a significant challenge: compliance failures within the supply chain. Burges Salmon, a UK law firm, conducted a study revealing the need for businesses to address ESG reporting within their supply chain to meet tightening regulations like the EU Corporate Sustainability Reporting Directive.
Titled “Supply chain ESG disclosure – Is your business ready?,” the report surveyed 360 business leaders across sectors including energy and utilities, technology, built environment, transport and healthcare. Alarmingly, 32% of respondents are entirely unprepared to meet their ESG supply chain disclosure obligations, with only 29% feeling confident in understanding the regulatory landscape.
Michael Barlow, Burges Salmon’s head of ESG, emphasises the necessity for UK companies to prioritise ESG compliance within their supply chain, requiring investment, resources, and continuous monitoring.
Large companies appear less prepared, with only 45% confirming a dedicated team for handling ESG matters and 43% claiming full understanding of regulatory risks. In contrast, smaller businesses show greater readiness, with 75% claiming full understanding of the legislative landscape.
The energy and utilities sector emerges as a leader in ESG alignment, with 68% of respondents indicating strong alignment between their company’s ESG commitments and those of its supply chain. However, challenges remain, particularly in developing comprehensive codes of conduct and verification procedures.
Conversely, the healthcare sector appears least prepared, with nearly a third of respondents admitting a lack of understanding of regulatory risks within their supply chain.
While some sectors show promise in meeting corporate disclosure obligations, significant work remains. The report emphasises the need for proactive measures to adapt supplier contracts, enhance risk assessment procedures, and foster greater collaboration within the supply chain.
Scotland emerges as a frontrunner in ESG preparedness, driven by a focused approach to environmental, social, and governance factors. Malcolm Donald, a partner at Burges Salmon’s Edinburgh office, notes a shift toward broader ESG considerations beyond environmental concerns.
To support businesses, Burges Salmon offers practical tools like the ESG Corporate Disclosure Tool, consolidating guidance, legislation, and training resources to navigate risks and capitalise on opportunities in the evolving ESG landscape.
Main photo: Burges Salmon
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