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Though ESG consulting is gaining popularity in Australian Boardrooms, discussions have largely focused on carbon emissions, climate risk, and reporting measurable climate data to investors. In this narrowed approach to the “E” and the “G”, countless businesses have been sleepwalking past the most obvious, powerful, and frequently untapped facet of sustainability: the health and safety of their employees.
In Australia, where the WHS obligations are codified, enforceable, and diligently enforced, the lack of integration of WHS consultants with ESG consultants is more than a lost integration. It’s a strategic blind spot. The WHS dimensions of safety and wellbeing must be elevated to ‘beyond compliance’ to truly achieve sustainability, and this should be the mandate of ESG consulting.
WHS Missing From ESG Is A Perversion
The “Social” part of ESG is “social responsibility” in rhetoric. In practice, however, most ESG activities focus on community involvement, reporting on the company’s diversity, and more importantly, ethically managing the supply chain. The lack of workplace safety, mental health, and psychosocial risk in ESG thinking and dashboarding is a stain on the profession. These issues cannot be absent in any serious attempt at workplace social sustainability.
In Australia, an ESG consultant should not only recognize WHS but also work with WHS specialists to measure injury outcomes, subsidize the use of leading indicators, incorporate health and safety metrics into investor disclosures, and seamlessly integrate WHS metrics into WHS health and safety disclosures. Participation in safety training, the tracking of near misses and other boundary injuries, and the fatigue risk protocols are not just operational trivia, rather they are important ESG data.
Integrating WHS Metrics into WHS Reports
The leading basic reporting Australian companies have to WHS in the state and territory WHS and OH reports also have to be compliant to WHS report. However, the reports are often compliance documents or left untouched in the safety silo. ESG WHS sustainability consultants have the ability to reposition WHS sustainability performance WHS leads as WHS indicators and unlock the full potential of WHS to corporate bio and ESG metrics.
Instead of spending time on box-ticking exercises for Safe Work inspections, consider the quarterly ESG reports LTIFR reporting in the ESG report as a LTIFR initiative. Why not use the safety culture survey results to inform the “S” of the ESG strategy. The WHS consultant collects the data, and the ESG consultant positions the data in relation to the investors and board level.
Psychosocial Risks: Where ESG and WHS Must Integrate
This obligation relates to WHS and ESG Management in Australia and to the psychosocial risk factors at work. The introduction of the new model WHS Regulations and the Safe Work Australia Code of Practice expect employers to engage in risk management that goes beyond the physical, to also address the psychosocial stressors of bullying, isolation, and workload.
It is more than compliance—the ESG policy has particular psychosocial elements that affect employee retention, productivity, and the company’s reputational capital. It is also the governance oversight. WHS and ESG consultants now need to work collaboratively to ensure psychosocial risk factors are given appropriate and sufficient focus in the ESG materiality assessments, workforce planning, and sustainability geo-strategies.
The Disconnect in Reporting Systems of ESG with WHS Systems
The WHS information is archived in compliance quadrants of Lahebo, Myosh, and Skytrust, in incident registers, risk assessments, and siloed records. ESG works with independent platforms or employs frameworks like GRI, TCFD, or SASB. The lack of interoperability between the systems makes cohesive interpreting and plumbing of data streams for actionable insights more difficult.
These are the circumstances of the manoeuvre ESG consultants have to make. High level advocacy for appropriate data architecture that ensures WHS insights are enriched in the ESG compliance reporting frameworks. Unified performance visibility is the goal, whether through shared APIs, cross-functional dashboards, or integrated audit cycles. Health, safety, and sustainability performance.
Incorporating Work Health Safety in ESG assurance systems
Including assurance in ESG reporting is becoming commonplace and investors, regulators, and loaners are increasingly calling for third-party assurance over sustainability metrics and WHS systems and safety management frameworks are relevant elements to be included in ESG assurance plans.
Including WHS audits and performance reviews to assurance scopes is something WHS consultants need to take the lead in. Their work will enhance the social governance components of ESG reporting, strengthening the credibility of ESG reports in Australia’s investment market.
Integrating WHS and ESG is good practice, but also a matter of necessity. Climate change is responsible for some workplace risks, like poor air quality and heat stress, and there is heightened scrutiny from stakeholders concerning labour practices. Legal obligations are also changing, so there is need for WHS to be a key part of the strategy.
Failure to include ESG in WHS planning is not just to miss key metrics. The argument for sustainable development is much stronger than the case put forward by ESG consultants who fail to weave WHS into their frameworks.
Conclusion
ASG consulting in Australia needs to broaden its scope. There is more to sustainability than carbon accounting and governance codes. There is also the health, safety, and dignity of the people doing the work. This is where WHS consultants should be, at the table, not the outer edges.
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