The power of ESG strategy in restaurants
Environmental, Social, and Governance (ESG) refers to the three key factors that measure the sustainability and ethical impact of a company. In recent years, investors have become more interested in companies with strong ESG performance, and customers are also increasingly looking for businesses that prioritise sustainability and ethical practices. Here are some ways that restaurants can incorporate ESG into their operations:
Environmental: Restaurants can focus on reducing their carbon footprint by sourcing local and seasonal ingredients, using renewable energy sources, switching to more sustainable packaging options, such as biodegradable or reusable containers, and reducing food waste by implementing portion control and donating excess food to charities.
Social: Restaurants can also promote social responsibility by offering fair wages and benefits to their employees, supporting local communities, and sourcing ethically produced ingredients.
Governance: Restaurants can improve their governance by adopting sustainable business practices, adhering to all relevant laws and regulations, fostering good ethical standards, and being transparent about their operations and decision-making processes, ensuring that all voices are heard and valued.
How one restaurant is making significant change
Boisdale is a UK restaurant group that prioritises ESG values across their business. The company is committed to operating in a manner that aligns with the principles of sustainability, diversity, and social responsibility.
Vishal Khimasia, Boisdale Finance Director, told Aston Lark: “Boisdale strives to make a positive impact on the environment, our workforce and the communities we serve. We prioritise the use of sustainable British produce throughout our operations, sourcing our ingredients from suppliers who share our commitment to ethical and environmentally responsible practices – from bread made fresh in St Johns Bakery, to native Oysters, Dumfriesshire Haggis, Wye Valley Asparagus, Shetland Mussels and of course Scottish Beef.
“Boisdale runs a sponsorship program for overseas staff looking to work in the UK, and currently 35 percent of our workforce are from this outreach program. Through various fundraising events, partnerships and direct donations, we generate financial support for charitable causes and have raised significant amounts over the last five years.
“Through these three pillars – sustainable produce, a diverse workforce, and charitable contributions – Boisdale Restaurant Group is a catalyst for positive change.”
How will a restaurant's ESG strategy affect its insurance?
Insurance companies are increasingly considering ESG factors in their underwriting and pricing processes. Implementing a robust ESG strategy can demonstrate to insurers that they’re taking proactive steps to mitigate risks related to environmental, social, and governance issues, such as climate change, workplace safety, and corporate governance.
A resilient business that is well placed to sustain future change and where investor and shareholder value is already healthy will undoubtedly attract increased insurance market options, and potentially a lower premium than one where there is no ability to demonstrate these vital behaviours.
Insurers are looking for more detail in their risk assessment for businesses applying for D&O insurance. And they will ask questions about it.
In summary, a good ESG strategy can have a positive impact on your business insurance as it demonstrates agility, resilience, and planning – which is encouraging to underwriters. By reducing your risk profile, this could potentially lead to lower insurance premiums and improved profitability.
We’re committed to supporting your business in securing the best possible Directors & Officers (D&O) insurance coverage and implementing an effective risk management strategy. Our experienced team is here to provide you with tailored solutions that meet your specific needs. Contact us on 020 7543 2807