70% of the UK public want to hear how companies are improving their responsible business performance, according to a new report. However, only 4 in 10 (42%) of people in the UK believe that companies of any size behave responsibly.
The annual global ESG Monitor from SEC Newgate is based on a survey of more than 14,300 people across 14 countries and territories. This year it includes the “Responsible Business Report: What the UK public expects” for the first time, for which it surveyed 1036 UK online respondents aged 18+.
This reveals that 6 in 10 (57%) of the UK public surveyed expect companies of all sizes to play a more active role in society, with what makes a “good business” no longer just based on making money. Three quarters (75%) say it is important that large companies conduct their business in responsible ways.
Advertisement
The same percentage also say that change starts from the top and that it is important to have leaders who are focused on conducting business responsibly.
The Monitor found that younger generations express a greater desire to see and hear about companies standing up as an active corporate citizen, with Gen Z having the highest expectation of companies to speak out on environmental and political issues.
ESG vs. ‘Responsible Business
Last year’s Monitor found that the term ‘ESG’ did not mean much to the public. However, the 2024 edition has found that ‘Responsible Business’ is better understood. In total, 89% of the UK public associate responsible business with positive attributes. Sustainability is the most common association, followed by ‘responsible’, ‘future focused’, ‘green’, and ‘respectful’.
Andrew Adie, Head of Green & Good at SEC Newgate UK, commented:
“Expectations for what makes a ‘good’ business have changed forever. To be trusted, widely respected, to be a business that people want to work for and with no longer means just making loads of money.
“Good business has to be sustainable, a good employer and supply chain partner, to support communities and to be an agent for positive change. Business has to use the resources and funding it controls to lead responsibly and deliver better outcomes for all its stakeholders. On top of this, it also has to generate revenues, investment returns, wages, profits and tax receipts.
“All of this takes place in a judgemental world fuelled by increasing scrutiny and activism where pledging to lead change isn’t enough, business has to prove it is delivering.
“Statements like this do not fall onto neutral political ground and the push back against ESG by critics, who call corporate responsibility out as ‘woke capitalism’ continues to grow. Yet on the other side of the fence, activist, public and political voices are advocating for greater corporate ambition.
“Navigating this complexity and understanding how perceptions and expectations of business are changing is critical if corporates are to grasp the opportunities and avoid the pitfalls.”
High expectations from investors too
The study also found that investors have even higher expectations on responsible business conduct than the UK public. 81% of investors believe it is important for large businesses to conduct their business responsibly (significantly higher than 72% of non-investors), and 79% believe that companies can be profitable whilst also performing well on ESG responsibilities (higher than 66% of non-investors). Half of investors (46%) say that they would sell their investment in a particular company if there were any unethical behaviours or practices.
Leyla Hart-Svensson, Head of Research at SEC Newgate UK, added:
“The research shows that corporate responsibility remains a growing trend and public expectation – and this lies at the heart of what it means to be a good business with a good reputation. It also sets up the challenge that businesses face in communicating their actions in today’s climate.
In 2024, the UK public expect companies to focus on being more than just a business. They expect companies to act in a responsible way, thinking beyond profitability and duties to their shareholders. And there is a clear gap between the perceived importance and performance of company actions that are key to responsible business.”
About Melanie May
Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via thepurplepim.com.