The United Nations Global Compact (UNGC) is a voluntary initiative launched in 2000, pushing companies and stakeholders to adopt sustainable and socially responsible policies.
Organisations are encouraged to align their operations and strategies with the Ten Principles of the UNGC; they should operate in ways that meet fundamental responsibilities in the areas of human rights, labour, environment, and anti-corruption. These principles provide a universal language for corporate responsibility and a framework to guide all businesses regardless of size, complexity, or location. With over 18,000 companies and 3,800 non-business participants from 160 countries, the UNGC is the largest corporate sustainability initiative globally.
It is important to note that the UNGC is not a substitute for existing regulatory approaches but rather a complementary voluntary initiative.
The UNGC provides a standardised framework through its Ten Principles, helping create a level playing field and promoting fair competition.
Companies participating in the UNGC commit to regular reporting on their progress. The Communication on Progress (CoP) is a disclosure statement that details a company’s implementation of the Ten Principles. While there is no scoring system, the CoP serves as a public disclosure of a company’s commitment and progress toward sustainable practices.
The UNGC aligns with other ESG frameworks by providing a set of foundational principles on responsible business practices. Other frameworks such as the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), and the Task Force on Climate-Related Disclosures (TCFD) often have specific standards and guidelines that can be mapped back to the broader principles outlined by the UNGC. For instance, in assessing ESG controversies, the principles of the UNGC are mapped to global norms like the UN General Principles of Business and Human Rights (UNGP) and the International Labour Organisation (ILO) Conventions.
The UNGC serves as a broad framework, and its principles often underpin or are harmonised with the more detailed or specific standards and guidelines provided by other ESG frameworks.
Companies have access to the CoP questionnaire that was revised in 2021.
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