Sustainability in practice: Analyzing environmental, social and governance practices in leading Latin American organizations' reports

Abstract

Sustainable development is crucial for the competitive advantage of industries. However, implementing this business model faces challenges that can impact its integration and compromise the adoption of actions to address environmental, social, and governance (ESG) issues that are of interest to stakeholders. To date, no in-depth study has presented the relationship between ESG issues and practical actions employed for sustainable development in companies within the Latin American context. Therefore, this article aims to evaluate the relationships between the main ESG issues and the actions applied to develop this theme in the Latin American industrial context, highlighting the main barriers, opportunities, and implications for this integration. As a methodology, a documentary analysis of 79 reports from Brazil, Peru, Mexico, Chile, Colombia, and Argentina was conducted using the content analysis method. This analysis highlighted central concerns such as climate change, water management, waste management, biodiversity, local communities, diversity, and inclusion. Additionally, a trend of ESG thematic dissemination was identified, which is in an early stage of maturity and lacks studies to quantify and diagnose the environmental impacts of Latin American industries. These findings directly impact the empirical evidence of how the Latin American industry is neglecting social issues, is still developing studies to quantify its environmental impacts, and strongly adheres to the concept and theme of ESG. The conclusions of this study highlight three main points: (i) From 2018 to 2022, 47% of material topics were related to at least one ESG pillar, with a predominance of the environmental dimension, (ii) there was a trend of increased adherence to ESG and improvements in the materiality of reports, and (iii) it is recommended to enhance indicators, accelerate the sustainable transition, and integrate ESG themes into supplier selection and workplace safety to strengthen sustainability practices in Latin American companies.