PN MP Claudette Buttigieg said that there are many who have very little, to no idea what Environment, Social and Governance (ESG) is, or what it is used for.
Buttigieg spoke on Tuesday at the PKF Malta’s second event on ESG, focusing on the social aspect, the “S” of ESG.
She said that many people have very little, to no idea at all what ESG is, or what it is used for, and that while auditors remain essential for a business, the social aspect of ESG is almost overlooked, after tackling the governance and environment aspect.
Buttigieg said that ESG reporting has gained more importance over the Corporate Sustainability Reporting Directive (CSRD), which requires companies to report on the impact of corporate activities on the environment and society and requires the audit of reported information.
She continued that businesses, companies and entities have an obligation to measure ESG, however, she pointed out that society may not have been prepared as it should have been to tackle the issue.
Buttigieg said that it was former PN MP Claudio Grech who was the only person to discuss ESG in the past, but it was not given any importance, and some tried to ridicule it.
“All laws, policies and strategies should and must have ESG in their foundation,” Buttigieg said, adding that businesses should not be left to address this on their own but government should legislate in their favour.
She also said that within her profession as Senior Executive Officer at the Research, Innovation and Development Trust (RIDT) at the University of Malta, research has shown a clear shift where businesses are choosing to support research based on the ESG framework, shifting funding towards ESG.
Buttigieg said that engagement in strong, meaningful social dialogue with the aim to make people happier, healthier and more fulfilled should be the focus.
Social Policy Minister Michael Falzon said that the social aspects of the community we live in must come first and foremost, and that politics should be social and inclusive.
“We would be failing if we only looked at the economical aspect only. The end result should be making a difference for the better in people’s lives,” Falzon said.
He said that change is constant and gathering speed, pressuring economic activity, the social aspects of life and governance.
Falzon spoke about a lack of skills in the workforce, and the need for reskilling and upskilling. He said that we need to continue importing workers, as well as addressing the strong decline in birth rate; issues which are global.
He said that social aspect sustainability should be for the long term, as society continues to face crises, as he mentioned the pandemic, the energy crisis and the large issue of climate change.
“If we want to succeed, we will leave no-one behind. The social aspect is the very fabric of our workers, aims and economies. If we do not look at the social aspect, we will be failing the governance and environment aspects,” Falzon said.
Falzon said that businesses must be given the opportunities to meet their potential, and that despite roles changing in the future, the destination must be the same.
“It is crucial to look at the social aspect in politics, as if we lack that, we will not succeed in reaching the real goal, to make societies better, and give everyone the opportunity for potential,” Falzon said.
Business Development Partner at PKF Malta Pierre Mangion spoke about the social impact being a component in creating sustainable growth, and to address income equality, access to education, healthcare and more.
He described PKF as an audit firm committed to transparency and ethical business practices, pinpointing key topics and enriching the existing knowledge of ESG.