Why the UN Global Compact is a CSR commitment that works

One reason the initiative has been so successful is the UNGC’s extensive toolbox, which includes action platforms to establish partnerships and solve challenges, an online UN Business Action Hub and other resources, such as a reporting partnership with GRI, which helps businesses share information, engage in open dialogue and take action to accelerate tangible progress toward a more sustainable world.

The UNGC has clearly been an important international initiative for the global adoption of sustainable business practices and, arguably, a proof-point that commitment to clear and achievable objectives works.

In fact, research shows that so far, the UNGC is accomplishing exactly what it set out to do and is producing impactful results. According to the UN Global Compact Performance Report, organisations that have committed to the UNGC’s 10 principles perform significantly better on sustainability measures.

The UNGC’s 10 principles are effective because these goals help companies hone in on the sustainability risks and considerations that should be top of mind for all businesses. For example, the UNGC principles that “businesses should support and respect the protection of internationally proclaimed human rights”and “businesses should work against corruption in all its forms, including extortion and bribery”are two that provide an umbrella for action that reduces risk, improves financial performance, progresses positive brand recognition and helps to create a more ethical, sustainable business.

But, as we all know, it’s not always easy to walk the talk of such commitments: resources are required to research, validate and reasonably assess how a company is following through, and to examine the correlation between commitment to the principles and advanced sustainability performance.

EcoVadis recently examined a sample of 30,000 companies on its database and found that organisations that have adopted to the 10 UNGC principles perform better on sustainability measures throughout supply chains.

Specifically, UNGC participants score, on average, 12 points higher compared to non-participants. And although some folks might think it requires a big business to make a big difference, our findings show otherwise: small- and medium-sized businesses (29-999 employees) demonstrate better performance than larger organisations and act faster when addressing critical sustainability issues.