From CSR to ESG

Corporate social responsibility (CSR) first started with early welfare measures in the 1800s. From the 1950s onward, as businesses recognised the “social contract” obliging them to contribute to societal needs, they began to integrate social interests with their core practices. Today, many companies see CSR as an essential self-regulating mechanism through which to ensure compliance with legal and ethical standards and make positive impacts on environment and society.

Externally, the drive for evaluation has accelerated. CSR is envisioned and executed from within, but outside stakeholders are now scrutinising companies much more heavily than before, using new criteria for environmental, social and governance (ESG). Investors consider aspects such as leadership, internal controls and executive pay as they examine a company’s environmental impact and relationships. One report from 2019 stated: “ESG is no longer a niche topic or a set of investment strategies that are separate from overall portfolio strategy.”

What comes after COVID-19?

The pandemic saw many companies put strategies for sustainability on hold – temporarily. Moving forward, these will be increasingly important as part of ESG. Both COVID-19 and climate change show there is an obvious need and appetite for deeper environmental and social responsibility on the part of companies. All must show they are serious about ESG, says Lydia Amartey-Williams, our corporate partnership lead. “It is becoming a key touchpoint for organisations, whether that links to investing or staff. They need to be aware they should be part of this conversation. Everything needs to feed into this. Before it was optional – now it’s very much more central.”

Companies are increasingly considering how to align partnerships, relationships and impacts to meet ESG standards. “For our corporate partners at IHP, it’s about thinking of the long-term impact of donations of medicine and health supplies, moving from an operational approach to one that’s strategic and collaborative,” Lydia explains. IHP actively comes alongside companies to help them achieve CSR goals and meet ESG requirements. “We help companies support communities and be socially responsible,” Lydia says. “Through our new ESG matrix, we can show companies directly how certain ways of working with us will help them meet targets in their frameworks.”

How we engage with ESG

IHP is currently looking at how its activities factor into areas of global concern such as provision of quality education, gender equality, justice and strong institutions, and infrastructure and innovation. We already engage deeply with the Sustainable Development Goal 17 - Partnerships for the Goals - acting as a bridge between the private and humanitarian sectors and helping coordinate action in the face of immediate need.  One example of our engagement is the development of needs-driven, reliable partnerships to build local NGO capacity. Another is our membership of multi-stakeholder networks such as the Partnership for Quality Medical Donations (PQMD).

There are many examples of how we are working to meet SDG targets, including our provision of access to medicines to help disrupt the vicious cycle of poverty and ill health in early years of life. Through our matrix, we can help larger corporate partners meet their ESG requirements. We can also create more capacity for smaller partners to manage ESG, supporting them to make a difference.

ESG provides a valuable extra layer of scrutiny, but CSR continues to act as a vital channel for companies to meet obligations within the societies they serve. “Things are changing and we are all still learning,” Lydia points out. Within the healthcare sector, IHP is taking a lead to meet global goals for sustainability. As we work on a robust ESG matrix, we will also continue to work closely with corporate partners to give them the confidence that their activities can have the best possible impacts.

Case study: Dr Reddy's

In November 2021, IHP once again sponsored the annual CSR Initiative of the Year Award at the Global Generics & Biosimilars Awards. This year, we celebrated the achievement of Dr Reddy’s in winning the category.

IHP awarded Dr Reddy’s the winning position for its well-rounded programmes that deal with significant issues despite COVID-19 challenges. Its community health intervention programme (CHIP) reduces burdens of disease and financial outlay among Indian families by providing primary healthcare including maternal and neonatal care. Its outreach team conducted health awareness programmes at schools and elsewhere as COVID-19 spread, demonstrating handwashing, hygiene and precautions such as social distancing. It also continued to dispense essential medicines, especially among pregnant women, new mothers and young children. A dedicated COVID-19 response saw it source ventilators, set up oxygen plants, distribute oximeters to 155 villages and make financial donations to improve health infrastructure to cope with future waves.

IHP’s chief executive Adele Paterson praised Dr Reddy’s “excellent programme with tangible key performance indicators and outcomes… It went beyond the immediate needs [arising from] COVID-19 to support vulnerable communities in the long term”.

International Health Partners has sponsored this award for several years to encourage generic medicine manufacturers to develop and grow their CSR activities. A marked increase in submissions shows how seriously the sector now takes CSR, and this is a trend we hope to see continue.

To find out more about how you can work with us to achieve your CSR and ESG goals, get in touch with our Corporate Partnerships Manager, Lydia at [email protected]