ESG umbrella
ESG (Environmental, Social, Corporate Governance) standards significantly influence a company's long-term development policies. From the perspective of employer-employee relations, activities in the areas of "S" and "G" play a vital role. The Social area helps build and maintain a friendly and safe work environment and sustainable workforce, while also attracting valuable candidates and reducing employee turnover. This is why DEI (Diversity, Equity and Inclusion) firmly falls under the ESG umbrella. The corporate Governance area helps to develop an ethical work environment, establish responsible business operations and manage the risk of non-compliance. ESG awareness and implementation has taken off in recent years in Europe and elsewhere, but do Polish employers recognise the significance of ESG and DEI and their empowering impact on businesses? Where are they on the ESG and DEI map?
“S” for Social, including DEI
DEI initiatives are not yet very common among Polish employers. There is barely any specific data, although in 2022 the Responsible Business Forum organised a survey among 800 medium-sized and large firms, representing 10 different industries.
Statistics
Only half of the Polish employers approached in the 2022 survey were familiar with the concept of managing diversity. The same study revealed that only a few per cent of the firms had implemented a separate formal document dedicated to diversity strategy. Less than a fifth had adopted programmes supporting selected groups of employees and only a third monitored salaries by gender.
Global structures
In our experience, it seems that the Polish employers with the most developed and advanced DEI initiatives usually belong to larger global structures. They have ready-made DEI programmes that can be implemented, making their task easier. However, DEI is not ‘one size fits all’ and employers can face difficulties when it comes to adopting (translating) global DEI solutions to the local context and the Polish work environment. For example, diversity sourcing and affirmative action may be legitimate in other jurisdictions, whereas in Poland they may be applied only to a certain extent and under strict conditions.
Polish specifics
Before adjusting or creating DEI initiatives, it is important to understand Polish determinants, e.g. groups at risk of exclusion. Currently, Polish society is homogeneous in terms of nationality, though it is predicted to gradually become more ethnically diverse due to the increasing immigrant population. Polish society is also among those aging the fastest in the EU, meaning that the population of senior employees is growing rapidly. As regards the LGBTQIA+ group, some worrying statistics show that approximately two-thirds of transgender (including nonbinary) individuals did not disclose their identity to co-workers (and more than 80% to their superiors). Only half of transgender employees who have disclosed their gender identity in the workplace feel that they have support from their co-workers and superiors.
Neurodiverse employees
Last but not least, there is an increasing number of neurodiverse employees who may bring different ways of thinking, different approaches to work, innovation and creativity. However, the standard work environment may be challenging for them and it is good to consider solutions facilitating their functioning at work and wellbeing.
“G” for corporate Governance
Strengthening the need for responsible business management by injecting corporate governance into ESG standards should be seen as very positive. This will further strengthen accountability and the importance of good governance and ethical conduct. The issue of corporate governance has been known in Poland for several decades and is associated primarily with a set of principles, procedures and practices related to the management and supervision of businesses. These are legal regulations in place as well as economic and management standards, as the set of issues that corporate governance can cover is very broad, and the law can only fill part of it. In addition to the commercial law provisions on the operation of companies and corporate bodies, there is still a lot of work to be done to ensure ES”G” compliance.
Whistleblowers – the long road to implementation
One of the most important elements of managing the risk of non-compliance with the law, ethics and internal regulations is whistleblowing. In Poland, however, the connotations of whistleblowing are still negative. One who reports is a 'snitch', which is a hangover from the difficult history of communism in Poland, when the extortion of testimony or anonymous tips were used to find evidence against political enemies. Even today, remnants of this period can be seen. According to research carried out by a major NGO in Poland, whistleblowers are reluctant to report irregularities concerning their colleagues, but are more willing to point out negligence on the part of the employer with regard to working conditions. In turn, some employers still treat whistleblowers as an unpleasant problem and an enemy/a traitor to the organisation. The attitude of those in power is not helping to break this stereotype – Poland is the only EU Member State that has not yet implemented the EU Whistleblower Directive (the deadline for implementation passed in December 2021). The new government, however, has promised to treat the issue of whistleblowers as a priority, so this may soon change.
Lack of sufficient regulations
In general, Poland is lacking regulations on preventing and responding to misconduct. For example, there are no detailed regulations on counteracting corruption, which is one of the greatest risks in modern business. On the other hand, there are quite a few regulations introducing principles of responsibility and a system of severe penalties for corruption and bribery. In addition, there are no strict rules or official guidelines about conducting internal investigations in response to suspected/detected irregularities. Employers rely on the provisions of labour and commercial law, criminal procedure and ethical principles, often taking an intuitive approach to internal investigations. The most developed in terms of risk management are large, usually multinational corporations that implement compliance procedures to respond to risks of irregularities. A significant proportion of employers still do not have the ‘trigger’ of a legal obligation to put the idea of corporate governance & compliance into practice.