ESG programs for Not-for-Profit
In today’s world, environmental, social, and governance (ESG) is a core pillar of value creation for organizations of all sizes. The need for NPOs to address ESG is no longer a discussion—it’s a necessity
With more than 170,000 NPOs in Canada1, the pursuit of funding is highly competitive, and as both donors’ and members’ expectations evolve, NPOs must invest in ESG.
1. http://sectorsource.ca/research-and-impact/sector-impact
ESG issues specific to NPOs
Every industry has different driving forces behind the development of ESG programs. The following issues are material to NPOs:
NPOs are purpose-driven by nature. By aligning their mission with the ESG imperative, NPOs can bolster their purpose both internally and externally.
Demonstrating ESG’s impact on issues that matter to current and potential donors can help grow the donor pipeline. This is important as ESG reporting fosters a culture of transparency, commitment, and growth that attracts donors.
Activating ESG initiatives on topics that current and potential employees care about can be leveraged to combat the effects of the Great Resignation. This is important as NPOs face particular talent attraction and retention challenges as salaries and benefits are traditionally less than private industries, and career progression opportunities tend to be less expansive.
Becoming more energy and waste efficient in day-to-day operations can demonstrate operational excellence, environmental stewardship, and a culture of innovation. The overall economic health of the organization is improved through cost savings. These funds can ultimately be reinvested in programs to support their core purpose.
Investing in an ESG program is more important now than ever. NPOs need to be aware of the increased pressure to measure and report on ESG metrics and demonstrate impact on issues that matter. Forming an effective, sustainable ESG strategy and leveraging technology to support your ESG journey will optimize growth and set your organization for long-term success.
Benefits of investing in ESG programs for NPOs:
Demonstrate social impact beyond the direct mission and vision
Brand reputation
Donor or member acquisition
Talent attraction and retention
Efficiency and innovation
Building trust and connection
Partnership opportunities