Written in partnership with Zei, a tool for evaluating, managing, and communicating CSR (Corporate Social Responsibility).
What is at stake?
Why is it important?
Unlike large corporations, startups are not yet subject to stringent regulations regarding their CSR commitments.
However, integrating ESG criteria into a business model from the outset, without waiting for future regulations, sends a strong message to stakeholders and constitutes a lever for performance, allowing the startup to:
➡️ Stand out among investors, which is advantageous for fundraising;
➡️ Differentiate itself from the competition and attract customers who are increasingly concerned about the impact of products/services they choose;
➡️ Attract and retain the best talent;
➡️ Reduce costs by limiting unnecessary expenses (energy consumption, paper waste, etc.);
➡️ Improve brand image (among both customers and potential talents to recruit) through social and environmental commitments.
59% of startups surveyed have implemented ESG initiatives, and 95% of those report real benefits.
Study "Startups and Responsible Entrepreneurship in 2022", EDHEC Entrepreneurs
Companies committed to CSR perform on average 13% better. CSR Guide 2023, Zei
3 actions to implement right now
1️⃣ Identify priority ESG areas
ESG covers a broad spectrum of topics; but not all of them are equally important for every industry, product, business model, or geographical location. Therefore, it is important to prioritize them.
2️⃣ Building the ESG Roadmap and Measuring Progress
- Appoint an ESG Sponsor
- Establish an action plan based on identified priority areas
- Determine impact indicators
- Integrate commitments into job descriptions and objectives for each employee
In the early stages, it is important for the founders to champion the ESG subject to align with the company’s vision, to drive the question foward, and to ensure its significance. Later, a sponsor can be found among the employees who can create a working group.
3️⃣ Ensuring Formal Monitoring of the ESG Roadmap and Communicating It
- Choose suitable tools to track the progress of initiatives (e.g., Zei, Goodsteps, Sami, etc.)
- Report to the executive body and to the non-executive body and present results to employees
- Create an ESG policy document and/or an impact report, aligning it with the company's mission and values
→ This document can be used internally as a roadmap, shared with stakeholders, or displayed on the company's internal website in a public version (e.g., Explora Project).
The startup can entrust the responsibility of the ESG subject from its inception to a board member, who will be responsible for regularly presenting key performance indicators (KPIs) to the board (e.g., annually). It is not necessary to establish specific quantitative targets at this stage (this is more relevant from Series A onwards), but adopting the habit of measuring KPIs from the start, will be crucial for the future.
Bettina Denis, Head of Sustainability & ESG at Revaia, leading European sustainable growth investor.
📚 Further Reading
🔍 Focus on Different Types of CSR Ecosystem Players
📝 B Impact Assessment (B Lab)
📝 CSR Toolbox (Vendredi)
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✍️ Contributors to this document:
Zei offers evaluation and management solutions for CSR initiatives. Theses solutions are designed for reporting and communication to clients and employees.
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