Social Metrics and Reporting

The Social Pillar

Social factors in ESG encompass how companies treat people—employees, supply chain workers, customers, and communities. While often harder to quantify than environmental metrics, social performance significantly affects business outcomes and stakeholder trust.

Workforce Metrics

Employment and Demographics

Total workforce: Employees by category (full-time, part-time, temporary, contractor)

Employee turnover: Voluntary and involuntary turnover rates

New hires: Hiring rates by demographics and location

Demographics: Gender, age, ethnicity/race (where legally permitted to collect)

Compensation and Benefits

Living wage: Percentage of employees earning living wage

Gender pay gap: Difference in average pay between men and women

Pay ratios: CEO-to-median-worker pay ratio

Benefits coverage: Health insurance, retirement plans, parental leave

Diversity, Equity, and Inclusion (DEI)

Representation metrics:

• Board diversity (gender, ethnicity)
• Management diversity
• Workforce diversity
• Diversity in hiring pipelines

Pay equity: Equal pay for equal work across demographics

Inclusion indicators:

• Employee engagement surveys
• DEI training participation
• Employee resource group participation

Equity in advancement: Promotion rates by demographic group

Health and Safety

Injury rates:

• Total Recordable Incident Rate (TRIR)
• Lost Time Incident Rate (LTIR)
• Near miss frequency

Fatalities: Work-related fatalities

Occupational illness: Rates of work-related illness

Safety training: Hours of safety training per employee

Industry standards: OSHA recordkeeping requirements (US), ISO 45001 certification

Training and Development

Training hours: Average hours per employee

Training coverage: Percentage of employees receiving training

Training types: Technical, leadership, compliance, safety

Career development: Internal promotion rates, career pathing programs

Labor Relations

Union representation: Percentage of workforce covered by collective bargaining

Freedom of association: Policies and practices supporting worker organizing rights

Labor disputes: Number and resolution of disputes

Supply Chain Social Metrics

Supplier Assessment

Supplier code of conduct: Percentage of suppliers agreeing to social standards

Supplier audits: Number and percentage of suppliers audited

Audit findings: Issues identified and remediation rates

Supplier training: Programs to build supplier capacity

Human Rights Due Diligence

Risk assessment: Identification of human rights risks in supply chain

High-risk suppliers: Number of suppliers in high-risk categories

Remediation: Actions taken when issues are identified

Key Supply Chain Issues

Forced labor: Policies and monitoring for forced/compulsory labor

Child labor: Age verification and monitoring systems

Working hours: Compliance with legal limits and industry standards

Wages: Living wage in supply chain

Health and safety: Supplier workplace safety performance

Customer and Product Responsibility

Product Safety

Safety incidents: Product recalls, safety complaints

Testing and certification: Compliance with safety standards

Quality management: Quality management system certification (ISO 9001)

Customer Privacy

Data protection: Compliance with privacy regulations (GDPR, CCPA)

Data breaches: Number and severity of breaches

Privacy policies: Transparency about data practices

Marketing and Labeling

Responsible marketing: Compliance with advertising standards

Product labeling: Accuracy and completeness of product information

Vulnerable populations: Safeguards for marketing to children, etc.

Access and Affordability

Underserved markets: Products/services for underserved populations

Accessibility: Products accessible to people with disabilities

Affordability initiatives: Programs to increase access

Community Impact

Local Economic Contribution

Local employment: Jobs created in communities

Local procurement: Spending with local suppliers

Tax contributions: Taxes paid by jurisdiction

Community Investment

Philanthropic giving: Cash, in-kind donations

Employee volunteering: Volunteer hours and programs

Community partnerships: Collaborations with local organizations

Community Relations

Stakeholder grievances: Community complaints and resolution

Indigenous rights: Consultation with indigenous communities

Displacement: Impact on local populations from operations

Social Reporting Challenges

Data Collection Difficulties

Privacy constraints: Legal limits on collecting demographic data (varies by jurisdiction)

Supply chain visibility: Limited data from suppliers, especially lower tiers

Subjectivity: Some social metrics require qualitative assessment

Attribution: Difficulty isolating company impact on social outcomes

Standardization Gaps

Social metrics are less standardized than environmental metrics:

• Different definitions (e.g., what counts as "living wage")
• Varying legal requirements by jurisdiction
• Cultural differences in expectations

Qualitative vs. Quantitative

Many important social factors resist quantification:

• Quality of stakeholder relationships
• Organizational culture
• Impact of community programs

Effective reporting combines quantitative metrics with qualitative narrative.

Social Reporting Best Practices

Be Comprehensive but Focused

• Report on material social issues (identified through materiality assessment)
• Include both positive performance and challenges
• Cover direct operations and supply chain

Provide Context

• Benchmark against industry peers
• Explain regional variations
• Connect metrics to management actions

Acknowledge Limitations

• Disclose data gaps and estimation methods
• Note where data collection is limited
• Describe efforts to improve data quality

Show Progress Over Time

• Multi-year trend data
• Progress against targets
• Actions taken to address identified issues

Enable Verification

• Document data sources and methodologies
• Consider external assurance for key metrics
• Subject sensitive claims to third-party review

Social Target Setting

Types of Social Targets

Representation targets: Goals for workforce diversity

Pay equity targets: Closing pay gaps

Safety targets: Zero harm, incident rate reduction

Supply chain targets: Audit coverage, issue remediation

Considerations

• Ensure targets are specific and measurable
• Set realistic but ambitious timeframes
• Align targets with material issues
• Consider both outcomes and processes

Key Takeaways

• Social metrics cover workforce, supply chain, customers, and communities
• Workforce metrics include demographics, compensation, DEI, health and safety, and training
• Supply chain social responsibility requires assessment, auditing, and remediation
• Customer metrics address product safety, privacy, and responsible marketing
• Community impact encompasses economic contribution, philanthropy, and stakeholder relations
• Social data collection faces challenges from privacy constraints, supply chain complexity, and standardization gaps
• Effective social reporting combines quantitative metrics with qualitative narrative

Next Module

Module 5 covers governance metrics and reporting—board structure, ethics, risk management, and other governance factors that underpin ESG performance.