Despite progress in sustainability and the fact that all companies demonstrate their commitment to people and the planet, only 40% of the companies surveyed report concrete and measurable environmental objectives. This percentage drops to 13% for social objectives.
This is one of the main conclusions of the study "Managing ESG issues in listed companies".The report, which we have carried out at Transcendent, analyses a sample of 85 companies listed on the continuous market, including all the companies in the Ibex 35.
While all companies make their commitments clear at a high level, few yet communicate their ESG objectives.
In the case of companies listed on the Ibex 35, 60% communicate specific, measurable and quantifiable environmental objectives. However, this figure drops to 26% for the rest of the listed companies.
As Ana Ruiz, partner at Transcendent, explains, in this article of El Economista "We are detecting an unprecedented acceleration, but the speed at which companies are advancing is not the same, and the difference between Ibex 35 companies and the rest of the listed companies is very palpable"..
The study shows that companies are putting more focus on environmental aspects compared to social aspects. Only 29% of the Ibex 35 companies communicate concrete, measurable and quantifiable social objectives, which, in most cases, are linked to diversity and inclusion.
In the rest of the listed companies this figure decreases to 2%. "Today, the environmental factor is much more integrated in companies than the social aspects".says Ana Ruiz, "and highlights the difficulty companies have in defining and measuring the social contribution they make"..
Ibex ESG performance
The report shows that there is a significant difference between Ibex companies and other listed companies with respect to the use of incentives linked to ESG performance, according to the report's findings. The Economist.
More than half of the Ibex 35 companies (54%) have a variable remuneration system linked to ESG performance. Most of the remuneration is linked to the achievement of sustainability objectives, especially environmental ones, such as the reduction of Scope 1 and 2 CO2 emissions or the reduction of water consumption.
The rest of the listed companies show a still incipient incorporation of this type of incentives, with only 18% declaring to have a bonus linked to ESG performance.
"Senior management remuneration packages linked to social and environmental objectives will accelerate their implementation as part of remuneration policy, both in the short and long term, because there is a trend among all stakeholders (consumers, companies, employees, investors, regulators and public institutions) to measure and value the impact of companies".explains Ángel Pérez Agenjo, managing partner of Transcendent.
In barely two years, the number of companies that have incorporated governance bodies dedicated to sustainability management has increased considerably, especially in the case of Ibex 35 companies.
The great progress made by Ibex 35 companies in terms of sustainability governance has not yet materialised in the rest of the companies listed on the continuous market.
The average across all the companies in the sample shows that 53% of them have a governance body responsible for dealing with sustainability issues either exclusively or in conjunction with other issues and reporting to the Board of Directors.
According to the report, in 14% of cases this function is integrated into other existing committees or bodies, generally the Appointments and Remuneration Committee.
68% of Ibex 35 companies have a Sustainability Committee (either specific or shared with other functions), which reports directly to the Board of Directors, while in 2018 this figure was three times lower (20%).
"This evolution over the last two years is largely due to the growing demand from investors and the increase in regulation in these areas, including the reform of the CNMV's Corporate Governance Code".explains Ana Ruiz.
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