Reports unveil companies green agenda

Recent news from the Amman Stock Exchange (ASE) reveals an impressive development: 95 per cent of the companies listed in the ASE 20 index sample have successfully published their sustainability reports. This demonstrates a significant commitment to transparency and environmental, social, and governance (ESG) practices within these organisations. But what does this really mean?

A sustainability report, also referred to as a CSR report or an ESG report, provides stakeholders with comprehensive details about a company's initiatives, policies, goals and performance. These reports cover various aspects, including environmental impact, social responsibility, corporate governance, employee welfare, community engagement and ethical business practices.

By publishing sustainability reports, companies showcase their commitment to transparency, accountability and responsible business practices. These reports enable investors, customers, employees, regulators and other stakeholders to evaluate a company's sustainability performance and make well-informed decisions. Investors can consider ESG factors when assessing a company's financial prospects and long-term viability.

The fact that these companies have published their sustainability reports suggests that they understand the significance of sustainability and actively engage in disclosing their ESG practices. Such reporting levels can bolster investor confidence, attract socially responsible investors, strengthen stakeholder relationships and contribute to the overall sustainability goals of the business community in the region.

ESG represents a framework that assesses a company's performance and impact in three crucial areas. Environmental factors evaluate a company's effects on the natural environment, encompassing aspects such as climate change, carbon emissions, energy efficiency, waste management, water usage, pollution, biodiversity and resource conservation. Strong environmental practices aim to minimise ecological footprints, mitigate environmental risks, and promote sustainability.

Social factors analyse a company's influence on society, including relationships with employees, customers, suppliers, communities and other stakeholders. Social considerations entail labour rights, diversity and inclusion, employee health and safety, human rights, community engagement, philanthropy, product safety and consumer protection. Companies emphasising social responsibility strive to make positive societal impacts and uphold ethical business practices.

Governance factors evaluate a company's leadership, structure, and decision-making processes. It focuses on board effectiveness, executive compensation, shareholder rights, transparency, ethics, anti-corruption measures, risk management, and regulatory compliance. Strong corporate governance ensures accountability, integrity and responsible management practices within the organisation.

In the context of reducing single-use plastic in Jordan, ESG considerations can indeed play a vital role. By highlighting the environmental repercussions of single-use plastic, companies can take steps to reduce its usage and explore sustainable alternatives. This may involve adopting reusable packaging, implementing recycling programs, and investing in innovative solutions to minimise plastic waste.

Engaging stakeholders, including customers, employees, and local communities, in initiatives aimed at reducing single-use plastic is crucial. Raising awareness, promoting responsible consumption habits, and encouraging eco-friendly alternatives can make a significant impact.

ESG considerations can extend to a company's supply chain, including suppliers and distributors. By integrating single-use plastic reduction goals into supply chain management, companies can encourage their partners to adopt sustainable practices. This could involve sourcing from suppliers prioritising environmentally friendly packaging, collaborating with distributors supporting plastic-free initiatives and setting stricter requirements for suppliers regarding plastic waste management.

Companies can also invest in research and development to explore alternative materials or packaging solutions that can replace single-use plastic. Collaboration with academic institutions, NGOs, and other stakeholders can support research efforts and drive innovation in plastic reduction technologies.

Furthermore, ESG practices involve advocating for responsible policies and regulations. Listed companies can collaborate with industry chambers, government agencies, and NGOs to push for stricter regulations on single-use plastics, waste management, and recycling. By participating in collective efforts, companies can influence policy changes that support the reduction of single-use plastics. Through such responsible and forward-thinking behaviour, companies announce their green agendas.