Businesses lag in social impact audit

Investors are increasingly looking at the social impact of businesses. FILE PHOTO | NMG
Investors are increasingly looking at the social impact of businesses. FILE PHOTO | NMG 

The chase to grow commercial value in businesses is core to organisations’ agenda.

However, there is an aspect that does not seem as pronounced in its totality — social impact of the business. As firms seek to grow their books, influence and market share, they may just have to be more keen on what has often been passed as public-eye-pleasing engagements.

Many companies are losing out on potential business as well as locking down foreign investments because they do not do sustainability reporting.

his is made worse by the lack of sustainability reporting professionals in the country. These are some of the issues that were cited last week at the launch of Horwath Erastus & Co’s sustainability reporting services in the country.

“Many investors, especially foreign or PE investors are looking at the social impact of businesses. There are people out there who use sustainability reports to gauge your performance, use it as a basis as to whether they will invest in your business,” said the Horwath Erastus & Co partner and head of commercial service unit, Cephas Osoro.

Safaricom #ticker:SCOM has been publishing sustainability reports in recent years.

“There are ethical investors. These don’t care about the profits, what they want to know is the story behind the profits, what the company is focusing on,” said Safaricom sustainability and social policy senior manager Karen Basiye.

Right from when it started the practice, it did not get a local firm to carry out the training and put together the report, and is still yet to. It has been using KPMG’s South African wing after the local office was unable to satisfy the need.

Sustainability reporting is where an organisation puts together a report on what it has been doing in social and environmental issues while balancing people, the planet and profit.