Environmental Social Governance (ESG) is increasingly being regarded as the standard way to measure a firm’s sustainability.
Not only is it a reporting requirement for investors, but for many individuals, it is also an indication that an organisation’s social standards align with its beliefs. Both prospective and current employees agree they want to work for a company with a diverse and socially conscious workforce.
A recent survey conducted by Oracle and Pamela Rucker, CIO Advisor, and Instructor for Harvard Professional Development, found that:
These figures highlight the growing importance of a coherent ESG program, especially when it comes to social implications.
Human Resource leaders and their departments are well-placed to play a significant role in enhancing the social aspects of their business’s ESG credentials and reporting capabilities. Thanks to HR’s ability to shape the people agenda within organisations, they can maintain focus on progress and make small or broad sweeping changes through strategy.
Developing a successful ESG program, which takes the Social component into account at every level of an organisation, poses several considerations. For example: how to engage employees with a strong focus on a culture whilst incorporating inclusion and diversity; or how to address issues of pay and equality within the business.
Technology can play a pivotal role in enabling and facilitating successful ESG programs. It has been reported that 89% of business leaders believe organisations that use technology to help drive sustainable initiatives will be the ones to succeed.
Oracle HCM Cloud provides an ‘out of the box’ legislatively compliant reporting solution for the Gender Pay Gap in the UK. However, our experience of working with large modern HR leaders is that there is more to be done.
Using Oracle’s HCM ‘Journeys’ functionality (part of the Oracle HCM Cloud application), Oracle Consulting is enabling a large UK financial organisation and a Global Media Group to analyse and evaluate the Gender Pay Gap at a more granular level than UK legislation requires.
Oracle Consulting has designed a new contextual journey to guide line managers through a step-by-step flow, giving them the information they needed to decide if ‘out of cycle’ salary changes are needed for their team members, and then act on behalf of the employee.
With this new contextual reward journey framework, salary increases consider gender equity, competitive market salary levels, and other relevant information. Any changes were simulated to reflect the potential impact on Gender Pay Gap at a team, department, and organization level.
This transforms the Gender Pay Gap from being an organization-wide issue tackled only by a top-down approach to a situation where managers are empowered to make considered decisions from the bottom up, as well as supporting the ESG strategy from above and below.
Oracle Consulting can support companies with many ‘pre-defined’ and personalised journeys to implement ESG Social programs, to accelerate time to value.
The Oracle HCM solution is strongly positioned to report on the standards within the Global Reporting Initiative (GRI) framework, which is the most referenced across all industries, receiving 83% of total references to ESG frameworks. Data captured within the HCM platform can be used to report on standards such as GRI 402: labour/management and GRI 405: diversity and equal opportunity.
In addition, Oracle Consulting has built an analytics solution to support the Gender Pay Gap calculations in the UK, at various levels of detail and with multiple levers to pivot the data. This is in addition to the ‘Out of the Box’ legislatively driven GPG for the UK.
The importance of having a comprehensive ESG program and coherent reporting is exponentially rising due to both regulatory and social pressures. Sustainable business models that are imperative for the future will only be reached through understanding ESG data and acting upon it now.
Oracle Consulting has deep knowledge and experience to assist our customers on the matter of ESG, be it engaging a diverse workforce or measuring your business’ Environmental, Social and Economic impact.