A recent assessment by the World Benchmarking Alliance (WBA) reveals that over 90 percent of the world’s 2,000 most influential companies are not meeting societal expectations concerning human rights, working conditions, and corporate ethics.
Some of the companies include BMW, Nestle, Rio Tinto, Pfizer, Amazon, Shein, and Standard Chartered.
Despite generating revenues that constitute 45 percent of the global economy, these leading corporations are missing a critical opportunity to improve the lives of hundreds of millions of people, according to the WBA’s report released on Tuesday, July 2.
“The companies have resources and influence equivalent to some of the biggest countries, impacting more people than the populations of many nations. The fact that 90 percent of these companies are failing to act on fundamental social expectations shows the state of play of the private sector.”
Namit Agarwal
Agarwal emphasized that showcasing leadership in fostering an equal, inclusive, and just world could significantly assist governments in eradicating poverty, reducing inequality, and ensuring access to decent work for all.
He stated, “Regulation, guidance, and external pressure are necessary to steer businesses in the right direction.”
According to the WBA, at least 30 percent of companies scored between 0 and 2 out of a possible 20 points, revealing a stark “mismatch between what companies disclose on decent work and society’s expectation of them.”
While more than 60 percent of companies provide some information about wages and at least 45 percent report on working hours, only 29 percent monitor the health and safety of supplier workplaces.
Furthermore, just 20 percent conduct human rights due diligence on their supply chain partners, and a mere 4 percent are committed to providing a living wage.
Corporate responsibility also remains an area of concern. Only 10 percent of companies disclose their tax payments, and 9 percent outline their engagement with stakeholders such as employees and trade unions.
Additionally, just 5 percent of surveyed companies revealed their spending on corporate lobbying despite their substantial economic influence.
“The lobbying efforts of the world’s 2,000 most influential companies, representing $45 trillion in revenue, can either drive or hinder sustainable development. Currently, however, there is no way to know which direction companies are pushing. Most companies are not transparent about their political engagement strategies or spending.”
World Benchmarking Alliance
Sector Breakdown
Among the 14 sectors surveyed, the apparel and footwear, ICT, and retail sectors ranked the highest for meeting societal expectations, with scores ranging from 28 percent to 33 percent, compared with the overall average score of 23 percent.
The funds and financial services sector scored the lowest at 11 percent, followed by the transportation industry at 14 percent and real estate at 16 percent.
Regionally, companies headquartered in the Asia Pacific scored the highest, with an average score of 35 percent, largely due to Australia’s commitment to disclosing tax payments.
Europe followed at 33 percent, North America at 24 percent, with the Middle East scoring the lowest at 11 percent, behind South Asia and East Asia with 14 percent each.
The WBA stressed that if the world is to achieve the UN Sustainable Development Goals, including halving poverty by 2030, the private sector must take greater responsibility for the economic and social conditions they create.
“Protest movements that have emerged around the world in the past decade are a visible indication that people want an economic system that works for the poorest majority rather than the richest few,” the nonprofit stated.
“Achieving the Sustainable Development Goals requires companies to engage in socially responsible business conduct, including respecting human rights, providing decent work with living wages and a fair and safe environment, and acting ethically by paying their fair share of taxes and lobbying responsibly.”
World Benchmarking Alliance
The report highlights the urgent need for corporate giants to align their operations with societal values, ensuring a sustainable and equitable future for all.
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