Why does ESG matter in a care home environment? As told by Matthew Taylor, Alternative Markets Lead at Utopi.

The care sector has tackled unique challenges in the past few years alone, with the COVID-19 pandemic and its repercussions continuing to be felt across this industry. According to new research, the £2.1 billion of governmental financial support to the care industry in 2020 has only postponed – rather than prevented – a financial crisis for the sector. Along with workforce shortages, inflation, and soaring energy costs, 2023 has been no easier.

Amidst these issues, there are increasing conversations around ESG (Environmental, Social, Governance) in care homes. So why – whilst there are so many other obstacles to overcome – does ESG matter in healthcare?

From improving patient wellbeing, staffing issues, and asset value to helping the industry reduce energy costs and raise funding, ESG can play a vital role in helping the care sector overcome its unique challenges.

Cost-saving in an energy crisis

As energy costs continue to escalate, it is crucial for care home operators to explore innovative strategies that can help mitigate these financial burdens. One of the most effective strategies could be to reduce energy wastage. Organisations need real-time data showing where their energy is being consumed, and this information can further enable them to analyse and cut unnecessary energy consumption – such as in communal areas.

With the advent of real-time data reporting, care homes now have the opportunity to gain increased visibility into their energy usage patterns and make informed decisions to reduce energy waste. By bringing together ESG data, care homes are provided with easy-to-use reports that can help boost their Care Quality Commission (CQC) ratings and enable them to monitor their ongoing environmental performance.

Giving back control over resident wellbeing

In the ever-evolving landscape of care homes, incorporating the latest innovations is essential to ensuring the safety and wellbeing of residents. With the introduction of real-time alert systems, care homes can proactively safeguard against avoidable harm and respond swiftly to any potential risks with the ability to track and control various aspects including temperature, air quality, and humidity levels of individual rooms as well as communal spaces. This allows them to turn off the heating system when it gets too hot, helping them improve patients’ wellbeing, elevate their standards of care and provide a secure and nurturing environment for their residents.

Without this technology in place, often residents need to open windows to cool down the temperature, which not only is harmful but also keeps heating systems running around the clock, leading to energy waste. Crucially, the ability of residents and operators to manage various aspects of a room raises both their comfort and CQC ratings.

Funding, investment, and asset value

According to Forbes, investors now acknowledge the significance of investing in socially responsible companies, including those in the social care sector. Embracing sustainability and incorporating ESG principles can not only attract investment but also assist in achieving long-term financial stability, allowing care homes to gain access to funding and investment opportunities that align with sustainable and responsible principles.

Moreover, by improving their ESG performance, care homes can directly increase the value of their assets. This not only allows them to act financially conscious but also contributes to reducing the environmental impact of their real estate holdings.

One powerful tool that has emerged is the use of comprehensive data sets, which provide evidence and impact measurement. By leveraging these real-time data sets, investors can showcase their value and progress in understanding the responsible use of resources. This contributes to combating climate change and leads to tangible benefits such as reduced operating costs and optimised resource allocation.

The demand for talent

The issue of staffing in care homes has become a pressing concern in recent years. According to the Skills for Care 2022 report, there has been a 52% rise in vacancies in the adult social care industry over recent years. As the demand for quality care services continues to rise, care homes are faced with the challenge of attracting and retaining talented professionals.

In today’s rapidly changing world, sustainability has become a top priority for individuals and organisations alike. The new generation of talent is placing increasing importance on environmentally conscious practices. As an integral part of society, care homes have the opportunity to attract this passionate and forward-thinking talent by driving ESG initiatives within their operations.

The social care industry plays a vital role in the well-being and support of individuals in society. As we navigate through an era of rapid technology advancements and increasing awareness about ESG issues, the industry must acknowledge the significance of sustainability and ESG practices and proactively work towards integrating these into their operations to pave the way towards a brighter, more sustainable and responsible future.