environmental, social, and governance efforts building blocks concept

Why You Should Care About Your Healthcare Organization’s Environmental, Social, and Governance Efforts

Love Your Melon is on a mission to provide a hat to every child who is battling cancer in the US. Ben & Jerry’s took a stance against white supremacy after the death of George Floyd. Cleveland Clinic locally sourced nearly 50% of its food for its main campus in 2020.

Social responsibility is becoming increasingly important for the success of businesses, and companies are doing everything they can to keep up. Often referred to as a company’s environmental, social, and governance (ESG) efforts, these initiatives show how much you are willing to put your money and time where your mouth is when it comes to making the world a better place.

The healthcare industry is no exception.


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Healthcare organizations have always made caring for patients and saving lives a priority. But recent studies suggest they need to take a step further with transparent social, environmental, and governance initiatives.

At the 2022 American College of Healthcare Executives (ACHE) Virtual Leadership Symposium, CareContent CEO, Kadesha Thomas Smith moderated a session with the CEOs of three healthcare systems discussing the importance of ESG efforts. Included in the session were:

There are plenty of reasons to put more time and effort into your ESG efforts. Not only does it improve your reputation among groups like investors, prospective employees, and consumers, but it also means you’re doing positive things in the world.

Here’s a breakdown of environmental, social, and governance criteria — and why your healthcare organization should bolster your efforts.

What Are Environmental, Social, And Governance Criteria?

Environmental, social, and governance criteria center around influencing positive change. They show that your company is committed to being responsible for society, which is often a marker for success and strength in a company.

While these three categories have the common goal of doing good in the world, they each have slightly different focuses.

Environmental Criteria

From your carbon footprint to the use of toxic chemicals in manufacturing, environmental criteria come down to your company’s impact on the environment.

In healthcare, organizations are making changes like using compostable cafeteria packaging and decreasing the environmental impact of medical supplies.

Social Criteria

Your social impact exists both within your company and in the broader community. This can include everything from LGBTQ+ equality to racial diversity to involvement in social movements beyond your organization.

In healthcare, this may take the form of improving the diversity of your board, prioritizing inclusion programs within your organization, and enhancing workplace safety initiatives.

Governance Criteria

Governance is about who is in charge of making decisions at your organization. It encompasses factors like diversity in leadership, executive pay, and how well leadership interacts with stakeholders.

In healthcare, governance criteria are getting the least amount of love. However, it involves crucial aspects, like the structure of your board, pay equity among your staff, and the prevention of fraud and ethics breaches.

Who Actually Cares About Your ESG Efforts?

ESG efforts are more than just another three-letter acronym to pay lip service to. These efforts impact those that have a stake in your company, either literally or figuratively.

To be clear — everyone cares about your ESG efforts to some extent. But some groups care a little more (and in different ways) than others.

1. Investors care the most about your ESG efforts.

Fighting climate change and promoting diversity does more than just show your company has a strong moral compass — it also suggests that you may offer investors higher returns.

For instance, JUST Capital’s JUST U.S. Large Cap Diversified Index (JULCD) found that, between 2017 and 2019, public companies with high ESG scores outperformed similar companies that lacked a clear commitment to factors like the well-being of their employees and their impact on the environment.

Investors also know that other stakeholders, like employees and consumers, care about your ESG efforts. This impacts the success of your organization, which has a direct correlation with how much money investors make.

2. Prospective employees care a lot about your ESG efforts.

Healthcare is experiencing a severe shortage of employees, from physicians to nurses everyone in between. This creates serious competition for the best talent, and ESG efforts are one way to set your organization apart.


PwC ESG stat 1 pie chart

About 58% of health leaders say they plan to increase diversity and inclusion training and reporting in the next year.

Source: PwC


How much your organization is dedicated to its environmental, social, and governance criteria matters to those considering working there. These efforts will enhance your reputation, build trust among your employees, and demonstrate what you value — all factors that will either resonate with prospective employees or drive them away.

3. Consumers care moderately about your ESG efforts — but they really care if you mess up.

Consumers of healthcare organizations may not be demanding specific ESG information on your website, but that doesn’t mean they don’t care.

To start, consumers want to see their values reflected in the organizations to which they give their money. This could mean your commitment to the environment, your role in certain social movements, what your leadership looks like — or all three.


PwC ESG stat 2 pie chart

More than 60% of US consumers say they would view an organization more positively if it was taking clear steps to address social determinants of health.

Source: PwC


What’s more, consumers are highly sensitive to ESG violations. For example, if consumers get wind that your carbon emissions are high — and your community also has high rates of respiratory issues — that’s a bad look. And as healthcare organizations are being called out for violating best practices, consumers may start demanding access to this information more often.

3 Ways To Enhance ESG Efforts

Your environmental, social, and governance efforts play a major role in your healthcare organization’s success. If you haven’t already begun prioritizing these efforts, now is the time to start.

Here are 3 ways to improve your ESG efforts and their visibility:

  • Incorporate ESG into your strategic goals. Determine how you will put ESG efforts at the forefront — and make it known to your stakeholders on your website, social media, and, most importantly, through your actions.
  • Be transparent and stay accountable. Gather real data, ideally using a third-party vendor to ensure neutrality. Track your ESG efforts and share your wins — and where you plan to grow — with your stakeholders.
  • Create a plan you can stick to. Investors, employees, and consumers can all see right through lofty goals that you’ll never meet (and never intend to). Identify a practical plan of action you can adhere to — and get to work.

As a healthcare organization, you already play an integral role in your community, and the entire country. While you continue to ensure you provide the best treatment for individual patients, consider amping up your ESG efforts to make the most positive impact on society, as well.

Do you want to be more transparent about your ESG efforts — or other core pillars of your organization — on your website? We can help.