Climate change. Biodiversity loss. Social inequality. The “great resignation”. The pandemic. The war in the Ukraine. Society and the planet are fraying at the edges. But there are three institutions best placed to put humanity and our environment on a sustainable course: government, investors, and associations—governments because of the regulations they can enact, investors because of their influence on business priorities, and associations because of their reach into professions and organizations around the world.
As associations wrestle with their relevance and value propositions, their members do the same. And the tussle made more complex by the backdrop of societal issues, ticking away in the background.
Those that are forward-thinking and driven to help their members become future-fit establish ESG (environmental, social and governance) programs to steer their professions and industries through the turbulence. They invest in measures to help re-engineer their memberships to be a force for good.
As articulated in past Boardroom articles (The Social Purpose of Associations: A Call to Action to Serve the Greater Good, Building Back Better: Time for Associations to Help Members Become Forces for Good, How Associations Can Help the Transition to an Inclusive, Low-Carbon and Circular Economy), associations are not only on the front lines of society’s social and environmental challenges, a number of them are leading the way. They are innovating in the absence of a clear roadmap for ESG progress. That is about to change, with the launch of a new guide for associations published by the Canadian Standards Association: SPE116: Environmental, Social and Governance (ESG) and Sustainable Development Goals (SDGs) for Associations.
The ESG/SDG Association
“ESG and SDGs for Associations” is the world’s first guide for associations to identify gaps and opportunities in their ESG programs. The special publication defines ESG as the consideration of environmental and social factors in organizations and how they are governed. It situates ESG and the United Nations Sustainable Development Goals (SDGs) as equivalents recognizing that some associations use the SDGs to address the environmental and social impact of their members, while others use an ESG lens.
The guide was developed with a small group of experts and practitioners to outline best practices to support ESG and SDG take-up within associations. It introduces the concept of an ESG/SDG Association which is a business, trade, industry, sector, professional or occupational association that implements measures that result in continuous improvement of the environmental and social performance of its own operations, the sector or profession it represents and its members. This includes:
- Helping members reduce their negative ESG/SDG impacts and enhance their positive ESG/SDG impacts, manage their ESG risks and opportunities, and contribute to a better world
- Improving the association’s own ESG/SDG practices and address its ESG risks as a distinct organization
- Activities that improve the sector’s/profession’s overall ESG/SDG impacts and address its collective ESG risks
The guide includes a rating system so associations can self-assess their performance and programs. The rating system has four recognition levels: bronze, silver, gold, and platinum. To determine their rating, associations benchmark themselves against 19 performance requirements as set out in the image below.
By rating themselves against these measures, associations and their boards can prioritize the gaps and strengthen the opportunities that make most sense for them and their members.
And there is a business case for these investments. Consultations to date show that associations benefit from ESG/SDG programs in a number of ways including:
Strandberg Consulting Inc. developed in whole or in part these ESG/SDG Works found at CSA SPE 116 but transferred its rights to copyright to CSA. It has CSA’s permission to use these Works, including with modifications, however, is solely responsible for this use.
- Managing risks: ESG/SDG issues can pose significant risks to organizations and their value chains. Associations can help the sector or profession anticipate and manage ESG or SDG trends, risks, and opportunities and thereby build sector/profession resilience.
- Supporting members: Single organizations and individuals face limits in how far they can go in advancing ESG/SDGs without reducing profits, losing market share, or facing other barriers, but if a sector or profession moves together it can make more progress on the issue.
- Building reputation: Leadership on ESG/SDGs can build credibility, reputation, and public trust of sectors/professions and can help build a sector’s social licence to operate and grow.
- Meeting expectations: ESG/SDG leadership can address member, investor, donor, client, buyer, and customer ESG/SDG expectations.
- Influencing regulation: Associations can influence, forestall, and prepare for government regulation regarding ESG/SDGs.
- Building relationships: Associations can build positive government and stakeholder relations.
- Growing membership: New ESG/SDG initiatives can attract and retain members and re-engage lapsed members.
- Attracting partners: ESG/SDG leadership can attract partners who share the association’s goals and can contribute funding, insights, expertise, networks, and other capacity on ESG/SDGs.
- Attracting employees: Given the increasing trend for employees to want to work for organizations that reflect their values, an ESG/SDG program can increase an association’s ability to attract, retain and engage employees.
- Demonstrating leadership: An association can show sector/profession ESG/SDG leadership regionally, nationally, and globally.
- Generating innovation: An association can enhance innovation, save costs, and open market opportunities for members.
- Enhancing clarity: Effective ESG/SDG programs can reduce complexity and create common sector/profession understanding of the ESG/SDG field.
- Maintaining relevance: Associations that have effective ESG/SDG programs can maintain their own relevance, provide an enhanced member value proposition, and ensure member needs for ESG/SDG guidance are met inside the association and not by competing initiatives.
Canadian associations are already seizing the opportunity that this guide represents.
Colleges and Institutes Canada (CICan) is the national and international voice for colleges and institutes in Canada, with 141 members. It has developed many leading ESG and SDG practices over the years and have used the guide to rate itself and to identify gaps and opportunities for continuous improvement. The association has self-assessed as “Gold” and has set an ambition to become a “Platinum” association by 2026. The outstanding items it is addressing include board-level leadership in oversight and governance to implement the ESG-SDG standard, integrating a social purpose in the mission of the organization, including a select number of SDGs in its strategic priorities, several engagement and knowledge-sharing opportunities with members, and showcasing the dynamism of the college sector and its commitments. CICan plans to include these initiatives in its upcoming strategic plan. It believes that a stronger college network creates stronger communities and stronger members and positions the association as an impact multiplier.
CICan is a member of the Canadian Society of Association Executive (CSAE). CSAE’s vision is empowering associations to transform the world. To advance that vision they are pursuing a number of efforts to improve their own social and environmental practices and to encourage their 2,700 members to do the same. CSAE plans to self-assess against the guide and create a roadmap to advance their organization and their members along the ESG/SDG path. Doing so will position the CSAE, their members and their collective stakeholders for success while helping Canada tackle its challenges.
As Tracy Folkes-Hanson, CSAE’s President and CEO, says: “We believe this guide can create a pathway forward for associations and their members to address ESG and the SDGs. It can help associations remain relevant and future-fit. A number of our association members are using this Guide already and we encourage other associations to consider doing so as well.”
Given the scale of the challenges we face as a society, and the yearning we all have to play our part to put humanity on a sustainable path, the time is now for associations to put their collective muscle to the task. By building their roadmaps to advance ESG and the SDGs within their sectors and professions it becomes possible to imagine a future that is safe for humanity.