How to use technology to track the S in ESG

On the face of it, the social element within ESG (Environmental, Social, and Governance) appears to be the trickiest to track and quantify. While a hotel can clearly measure their water usage or see that their chefs are wasting less food compared to last month, the answer to a question like: “How well are we treating our staff?” seems altogether more nebulous. How to put a number on it?

In truth, there are several indicators that managers and HR personnel use, such as regular job satisfaction surveys, employee net promoter scores, retention rates, absentee rates, etc.

Indeed, many will argue that a key strength of ESG frameworks is that they compel companies to measure and track very different areas of their businesses in similar ways. One technology platform helping businesses do this is called FuturePlus.

'Sustainability, inclusion, and social impact'

The FuturePlus platform requires businesses to answer 160-300 questions; many with a simple yes or no, others requiring evidence.  Co-founder Michael Penrose says: “The methodology is very similar to how an insurance company will work out risks. It’s a comparable audit.  We work across sectors, so we can compare a hotel company with an accountancy firm or a petro-chemical company.”

FuturePlus claims that it developed and delivered the ESG framework that underpinned Soho House’s successful IPO on the New York Stock Exchange in July 2021. At the time, Jamila Brown, head of social responsibility and sustainability, Soho House, said: “FuturePlus helped us to build a framework which covered things we hadn’t considered yet, so not only was it a plan of things we knew we needed to do, but it helped us by highlighting some goals that we hadn’t yet identified. It was super useful to have a mixture of quick wins that we could put in place straight away and bigger projects.”

Privately owned L&R Hotels, with £13b invested in 115 hotels across ten countries, is another FuturePlus client. Penrose adds: “Asset owners are finding that the value of their assets and their ability to get finance and loans is very much linked to their focus on sustainability, inclusion, and social impact.”

Job satisfaction

At IHIF 2023, Mark Goodyer, HR director, Sodexo UK & Ireland, highlighted the pivotal role of technology in supporting its workforce during challenging times.

Sodexo employs 35,000 people across the UK and Ireland, 43 per cent of whom are either on the National Living Wage or the Real Living Wage. Despite difficulties, first with Covid-19 and now with the cost-of-living crisis, internal surveys at Sodexo reveal a positive trend: an increase in job satisfaction and staff engagement over the past few years.

So, how has Sodexo achieved this? According to Goodyer, the key lies in making employees feel genuinely valued. Sodexo focuses on understanding what factors contribute to an individual’s sense of value at work, ensuring that employees can deliver value not only for the business but also for themselves.

Sodexo offers tangible benefits to enhance employee well-being. YuLife is a health and well-being app that encourages daily activities such as walks, meditation, and mental exercises. Users earn Yucoins, which can be exchanged for rewards from retailers like Amazon, Aldi, Tesco, and Argos. The app also provides access to a 24/7 GP and allows booking up to three days of paid volunteering.

In addition, Sodexo offers a discount scheme that allows employees and their friends and families to save on their shopping, delivered via Perks at Work. Goodyer says: “We've deployed a discount programme not only for our employees but also for up to ten of their family and friends. We've just ticked over £5 million saved through that programme. So, it starts meaning that we can impact communities, and not just our employees.”

To further address financial stress, Sodexo collaborates with Salary Finance, an online platform offering free financial education, videos, life guides, webinars, savings calculators, budgeting tools, and access to credit scores. Sodexo employees can also apply for affordable loans, repaid directly through their salary. These low-cost loans serve as an alternative to credit cards, payday loans, and overdrafts.

Taking care

Similar schemes are in place at the major hotel brands. Marriott’s ‘Take Care’ programme offers personalised health tips, mental health resources, and fitness challenges to employees. Recognition tools also facilitate peer-to-peer appreciation within the organisation. The Thrive At Hilton platform, likewise, focuses on employee engagement and well-being.

Accor and Hyatt use Diversity, Equity and Inclusion (DEI) analytics to focus on pay equity and workforce diversity and they publish their progress and goals.

IHG and Choice Hotels’ learning management systems deliver bespoke training modules on diversity, cultural competence, and social responsibility. Employees can access bite-sized content to enhance their awareness and skills, with certificates for those who complete DEI training.

Wyndham and Meliá deploy supplier diversity management tools that help them collaborate with vendors run by women and minorities.

Unlike counting utility consumption, measuring the social element of ESG is not an exact science but that doesn’t mean companies are not required to do it. And technology can certainly help with the process. 

As Braiden Goodchild, ESG real estate deals leader at PwC, says, if you are spending $250,000 on diversity, equity and inclusion training for 1,000 employees, then you need to be able to record exactly what that investment has achieved.