Understanding the European Sustainability Reporting Standard (ESRS) S1 on Own Workforce

Today, we want to shed some light on the European Sustainability Reporting Standard (ESRS) S1, which focuses on a company’s own workforce. This standard is crucial for companies aiming to ensure transparency and responsibility towards their employees.

Here's a comprehensive overview:

Objective:

ESRS S1 is designed to specify disclosure requirements that help users understand a company’s material impacts on its workforce, along with related risks and opportunities. 📊

👥 Definition of Own Workforce:

The term "own workforce" includes:

• Employees: Those in an employment relationship with the company.
• Non-employees: Individuals with contracts to supply labor or provided by employment agencies.

Note: Workers in the upstream or downstream value chain are covered under ESRS S2.

📋 Key Aspects:

Working Conditions

• Secure employment 
• Adequate wages 
• Social dialogue 
• Health and safety

Equal Treatment and Opportunities:

• Gender equality 
• Training and skills development
• Inclusion of persons with disabilities

Other Work-related Rights:

• Child labor 
• Forced labor 
• Privacy

📢 Disclosure Requirements:

1. Policies Related to Own Workforce: Describing policies to manage material impacts, risks, and opportunities.
2. Engagement Processes: Engaging with the workforce and representatives about impacts and informing decision-making.
3. Remediation Processes: Channels for raising concerns and addressing negative impacts (e.g., grievance mechanisms).
4. Actions on Material Impacts: Disclosing actions taken to address material impacts and their effectiveness.
5. Targets: Setting and tracking time-bound, outcome-oriented targets for workforce management.
6. Employee Characteristics: Total number of employees, breakdowns by gender and country, and employee turnover rates.
7. Non-employee Characteristics: Total number of non-employees, contract types, and methodologies for data compilation.
8. Collective Bargaining and Social Dialogue: Extent of collective bargaining agreement coverage and employee representation.
9. Diversity Metrics: Gender distribution in top management and age distribution of employees.
10. Adequate Wages: Ensuring employees are paid adequate wages according to benchmarks.
11. Social Protection: Coverage by social protection programs for major life events (e.g., sickness, unemployment).
12. Persons with Disabilities: Percentage of employees with disabilities.
13. Training and Skills Development: Participation in training and career development reviews.
14. Health and Safety Metrics: Coverage and performance of health and safety management systems.
15. Work-life Balance: Entitlement and usage of family-related leave.
16. Remuneration Metrics: Outlining the gender pay gap and remuneration ratio of highest-paid individuals to median employee pay.
17. Incidents and Human Rights Impacts: Reporting on work-related incidents, discrimination, and human rights impacts.

📚 Final thoughts:

By embracing ESRS S1, companies can ensure they are not only compliant but also champions of a sustainable and ethical workplace. While these standards are not prescriptive, they provide valuable insight into opportunities and can serve as a stepping stone for effective planning and decision making regarding a company’s workers. 🌟

Feel free to share your thoughts or experiences with implementing these standards in the comments below! Let's strive for a better and more transparent future together! 🤝

#Sustainability #ESRS #CSRD #Workforce #CorporateResponsibility #Transparency #BusinessEthics #Compliance

For more detailed insights, refer to the ESRS S1: Own Workforce document and related sustainability standards.

About the Author

Cole Ezeilo is a social entrepreneur, creative, and ESG policy analyst with a background in International Relations. Through his experiences with social enterprises and impact measurement work with NGOs, Cole strives to add value by implementing sustainable and creative solutions for problems faced by society today. He is also a published freelance journalist, and an opinionated lover of music, film, and culturally-rooted food.