Covid pushes ESG up the agenda in Irish boardrooms
A new survey shows that board level discussions of environmental, social and governance (ESG) matters are up 30% since the start of the Covid-19 pandemic.
The survey, from the Diligent Institute and Institute of Directors in Ireland, reveals that ESG is being treated with increasing importance by business leaders.
59% of respondents said that ESG is mainly dealt with at board level or a subcommittee of the board.
Eight out of 10 respondents also said ESG matters are discussed at board level at least once a year, compared to 52% who said their board discussed ESG before March 2020.
The survey also found a general optimism that ESG will be discussed more frequently at the board level in the coming years.
97% of respondents indicated that their board will discuss ESG matters at least once a year over the next three years.
The Institute of Directors in Ireland also said that 58% of survey participants said they have introduced measures to reinforce “strong pillars of governance”, while 42% had introduced measures to reinforce their diversity policies.
26% responded that they have introduced policies on climate change and sustainability, the IoD added.
Today’s survey also revealed a hesitancy towards tying ESG metrics to directors’ remuneration, with just 17% of respondents saying they already do so. But this figure is expected to more than double to 37% in 2021.
Maura Quinn, chief executive of the Institute of Directors (IoD) in Ireland, said the onset of the Covid-19 pandemic has marked a turning point for ESG in Irish boardrooms.
“Good governance has never been as important as it is now, and Irish board members have adapted to the changing needs of their stakeholders by prioritising the issues that matter most to them,” Maura Quinn said.
“The findings of this survey show encouraging progress in terms of ESG in Ireland. Going forward, ESG is set to become a main board agenda item, with an impressive 97% of our respondents indicating that ESG will feature in boardroom discussions at least once a year,” she added.
Dottie Schindlinger, the executive director of the Diligent Institute, said that Irish boardrooms are mirroring global trends with an increasing focus on ESG.
“Companies are under sustained pressure to take action on ESG matters, such as climate action and social justice issues – and this pressure only increased during the pandemic,” she said.
“This is especially true amongst younger workers who seek out companies who share their values. Investors are also looking at sustainability and holistic ESG profiles before deciding where to put their money,” Ms Schindlinger added.
This survey is the first time that IoD Ireland has partnered with the Diligent Institute, the research arm and think tank of Diligent Corporation, a governance, risk and compliance company which employs 200 people in Galway.