60% of companies do not specify environmental objectives

Despite advances in sustainability and the fact that all companies demonstrate their commitment to people and the planet, only 40% of the companies analyzed communicate concrete and measurable environmental objectives. This percentage drops to 13% in the case of social objectives.

This is one of the main findings of the study. “The management of ESG aspects in listed companies”, which we have carried out at Transcendent and which analyzes a sample of 85 companies that are listed in the continuous market, including all the companies in the Ibex 35.

Although all companies demonstrate their commitments at a high level, there are still few that communicate their ESG objectives.

In the case of companies listed on the Ibex 35, 60% report concrete, measurable and quantifiable environmental objectives. However, this figure drops to 26% for other listed companies.

As Ana Ruiz, partner of Transcendent, explains in this paper by El Economista ” we are seeing an unprecedented acceleration, but the speed with which companies are advancing is not the same, and the difference between the Ibex 35 companies and the rest of the listed companies is very palpable”.

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The study shows that companies are focusing more on environmental aspects compared to social ones. Only 29% of Ibex 35 companies communicate concrete, measurable and quantifiable social objectives that, in most cases, are linked to the issue of diversity and inclusion.

In the rest of the listed companies, this figure decreases to 2%. “Nowadays, the environmental factor is much more integrated into companies compared to social aspects”, says Ana Ruiz, “and highlights the difficulty of companies in defining and measuring the social contribution they make”.

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Ibex performance in ESG

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The report shows that there is a significant difference between Ibex companies and other listed companies regarding the use of incentives related to ESG performance, according to The Economist.

More than half of the Ibex 35 companies (54%) have a variable compensation system linked to ESG performance. Most of the remuneration is linked to the fulfillment of sustainability objectives, especially environmental objectives, such as the reduction of CO2 emissions of scope 1 and 2, or the reduction of water consumption.

The rest of the listed companies show a still incipient incorporation of this type of incentive, since only 18% declare that they have a bonus linked to ESG performance.

“Senior management compensation packages linked to social and environmental objectives will accelerate their implementation as part of the compensation policy, both in the short and long term, because there is a tendency on the part of all interest groups (consumers, companies, employees, investors, regulators and public institutions) to measure and assess the impact of companies”, explains Ángel Pérez Agenjo, managing partner of Transcendent.

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Sustainability Commissions

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In just two years, the number of companies that have incorporated governing 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 materialized in the rest of the companies listed in the continuous market.

The average among all the companies in the sample shows that 53% of them have a governing body responsible for dealing with sustainability issues exclusively or together with other issues and that reports to the Board of Directors.

According to the report, in 14% of cases this function is integrated into other existing committees or bodies, generally that of Appointments and Remuneration.

68% of Ibex 35 companies have a Sustainability Commission (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 2 years is largely due to growing investor demand and increased regulation in these aspects, including the reform of the CNMV Code of Good Corporate Governance”, explains Ana Ruiz.

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