Environmental, Social and Governance Fuels Impact Sourcing

The growing focus by companies on Environmental, Social, and Governance (ESG) goals is pushing impact sourcing forward, according to leaders of GISA-winning firms. Below are their thoughts on how ESG and impact sourcing are coming together to make a difference. 

Kevin Parikh, Avasant Global CEO and Chairman

I would argue that ESG is a large accelerant to impact sourcing. It is raising exponential awareness of the importance of sustainable companies, governance, and of being socially aware and environmentally conscious. It is also taking advantage of capabilities, right under our noses, in underprivileged communities. I am excited about ESG, because of all of the ESG initiatives many companies are investing in – such as the United Nations Global Compact running sustainability programs. I believe that these are important accelerators to impact sourcing.

Alfredo Gersava Jr., Chief Marketing Officer, Virtualahan

The growing focus by companies on ESG can help to advance impact sourcing in several ways. Firstly, ESG provides a comprehensive framework for companies to assess and manage their social and environmental impacts, including their efforts towards diversity, equity, and inclusion (DEI). Impact sourcing, which combines social impact with outsourcing, aligns with the social and governance aspects of ESG, as it promotes inclusive employment opportunities for underrepresented groups such as People with Disabilities (PWDs). By prioritizing ESG, companies can ensure that their impact sourcing initiatives are in line with their overall sustainability and social responsibility goals.

Secondly, the focus on ESG can help raise awareness about impact sourcing among companies and investors. As ESG becomes a mainstream consideration for businesses, investors, and consumers, companies are increasingly recognizing the value of impact sourcing as a socially responsible business practice. This can lead to greater adoption of impact sourcing as a means to create positive social and economic impact, particularly for disadvantaged communities.

Thirdly, the emphasis on ESG can encourage companies to invest in impact sourcing initiatives, providing the necessary financial resources and support for these programs to thrive. Impact sourcing requires upfront investments in training, technology, and infrastructure to create meaningful employment opportunities for PWDs and other marginalized groups. By prioritizing impact sourcing as part of their ESG strategies, companies can allocate the necessary resources to support the growth and sustainability of these initiatives.

The growing focus on ESG can indeed help to advance impact sourcing by providing a strategic framework, raising awareness, and facilitating investment in initiatives that promote inclusive employment opportunities and social impact. By integrating impact sourcing into their ESG strategies, companies can contribute to a more sustainable and inclusive future for all.

Pam Sands, Vice President – Diversity Office, Kelly

The growing focus by companies on ESG factors absolutely can help advance impact sourcing. ESG criteria refer to a set of standards that investors, stakeholders, and consumers use to evaluate companies' sustainability and societal impact. These standards cover a wide range of issues, including but not limited to labor practices, human rights, environmental sustainability, diversity and inclusion, and community engagement.

Impact sourcing, on the other hand, is a business practice that prioritizes social and environmental impact alongside financial returns. It involves sourcing goods and services from suppliers that create positive social and environmental impacts, such as creating jobs for marginalized communities, reducing carbon emissions, or supporting small-scale business owners.

By incorporating ESG factors into their business operations and supply chain management, companies can identify and work with suppliers who prioritize impact sourcing. This helps to promote sustainable economic growth and community development while providing high-quality goods and services to consumers.

Olivier Camino, global COO and Co-founder of Foundever

With the growing focus on ESG disclosures and sustainability reporting among corporations, many companies aim to provide key stakeholders with information that will help them make informed decisions. ESG disclosure regulations have increased in recent years and require organizations to align their ESG goals, risks and standards with business practices to highlight advancements in key strategies such as impact sourcing. 

Dhiraj Dolwani, Chief Executive Officer, B2R Technologies

ESG adoption has definitely led to increased awareness of the need for sustainable and socially responsible business practices. The connection between ESG and building brand reputation and customer loyalty is increasing, making ESG investments more attractive. Adoption of impact sourcing as part of the overall sustainability strategy still has a lot of ground to cover. Corporations could consider frameworks like the Everest Group ‘Purpose Framework’ to help fine-tune their ESG implementation approach in respect of people/social and planet/environment.