The “S” (Social) in ESG measures how a company treats people: its employees, workers in its supply chain, customers and communities. Unlike carbon, which has a common unit of measurement, the Social pillar comprises many groups of metrics; but each group has a clear disclosure standard within the GRI Standards.
Key takeaways
- Eight groups of metrics: occupational safety, employment, training, diversity, human rights, supply chain, communities and customers.
- Investors look at trends over several years and at how a company handles incidents, not just at flattering figures.
- Most social data already exists in HR and safety systems — the issue is standardisation.
Eight groups of social metrics
| Group | Example metrics | GRI standard |
|---|---|---|
| Occupational health and safety | Work-related injury rate, lost days | GRI 403 |
| Employment | New hires, turnover rate, benefits | GRI 401 |
| Training | Average hours of training, development programmes | GRI 404 |
| Diversity and equal opportunity | Share of women by level, female-to-male pay ratio | GRI 405 |
| Human rights and labour | Non-discrimination, child labour, forced labour | GRI 406, 408, 409 |
| Supply chain | Share of suppliers screened using social criteria | GRI 414 |
| Local communities | Engagement programmes, impact assessments | GRI 413 |
| Customers | Product safety, data privacy | GRI 416, 418 |
How do investors and banks read these metrics?
- Trends: an accident rate falling over three years is worth more than one good year.
- Incidents and response: how the company handles complaints, accidents and violations.
- Coverage: whether the data includes outsourced workers and contractors.
- Evidence: whether the figures can be traced back to original records.
Where to start?
Choose the three or four groups most material to your sector through a materiality assessment, standardise the metric definitions and then expand gradually. See also: occupational safety, gender equality, responsible supply chains.
Frequently asked questions
Why is the “S” harder to measure than the “E”?
Because social impacts are diverse and cannot be converted into a common unit; however, each group of metrics has a standard definition and calculation method in GRI.
Which social metrics matter most?
It depends on the sector: for manufacturing, occupational safety and the supply chain; for finance and technology, data privacy and workforce diversity.
Does charitable giving count towards the “S”?
Yes, within the community group, but it carries much less weight than how a company treats its workers and manages the impacts of its core business activities.
VietESG — Independent ESG rating organisation. Ratings based on disclosed data, supporting evidence and a public methodology aligned with GRI and the SDGs.
