P-ISSN 1859-3585 E-ISSN 2615-9619 ECONOMICS - SOCIETY

MAJOR DETERMINANTS FOR ENVIRONMENTAL - SOCIAL -

GOVERNANCE REPORTING AND THE FEASIBILITY
OF INTEGRATING IN VIETNAM
CÁC YẾU TỐ CHÍNH TRÊN BÁO CÁO MÔI TRƯỜNG - XÃ HỘI - QUẢN TRỊ
VÀ TÍNH KHẢ THI KHI ỨNG DỤNG TẠI VIỆT NAM
Nguyen Thi Phuong Mai1,*, Nguyen Ngoc Huyen1
DOI: https://doi.org/10.57001/huih5804.2023.238
accordance with a set of environmental, social, and
ABSTRACT
governance (ESG) standards. In [9], authors demonstrated
The goals of the research are to provide general environmental, social and the necessity of integrating ESG information into a
governance (ESG) metrics for Vietnamese corporations on the path of integrating company’s strategy since financial figures could not present
ESG reports and to assess the feasibility of using them. The metrics were based on a complete picture of a company’s position and
the GRI Standards and regulations in Circular No. 96/2020/TT-BTC integrating performance. Since then, many frameworks and guidelines
significant indicators from other standards. The result of the questionnaire on the have been established in order to guide companies on a
application of the proposed indicators showed that companies can disclose more sustainable path. Detailed indicator sets have
common indicators but have limitations on the disclosure of the remainders. From appeared along each framework, and many nations have
there, recommendations and suggestions were made for not only large
started to create their own set of indicators, aiming to
corporations but also SMEs and Vietnamese authorities.
provide a standardized set. At the same time, the authorities
Keywords: ESG reporting; ESG implementation; sustainable development. also imposed mandatory requirements with clear directions
and targets. Despite this, challenges remained. Even with
TÓM TẮT
clear policies and guidelines on the integration of
Mục tiêu của nghiên cứu này là đề xuất các chỉ tiêu đánh giá về vấn đề môi sustainability indicators on the national level, they do not
trường, xã hội và quản trị (ESG) cho các doanh nghiệp Việt Nam trên con đường seem to be enough for the international scale.
triển khai báo cáo ESG, đồng thời đánh giá tính khả thi trong việc sử dụng chúng.
Recognizing the significance of sustainability, the
Các chỉ tiêu được xây dựng dựa trên tiêu chuẩn của GRI và các quy định của Thông
Ministry of Finance released Circular No. 96/2020/TT-BTC on
tư số 96/2020/TT-BTC cùng với các chỉ tiêu quan trọng từ các tiêu chuẩn khác. Kết
November 16, 2020, outlining the standards and
quả khảo sát về khả năng áp dụng các chỉ tiêu được đề xuất cho thấy các công ty
instructions for ESG information disclosure on the stock
có thể công bố những chỉ tiêu chung nhưng bị hạn chế trong việc công bố những
market for publicly traded firms in Vietnam. Under the
chỉ tiêu còn lại. Từ đó, các tác giả đưa ra những đề xuất, khuyến nghị không chỉ
guidance of the State Securities Committee (SSC), they are
cho các doanh nghiệp lớn mà còn cho các doanh nghiệp nhỏ và vừa cũng như cơ
required to disclose ESG information such as greenhouse
quan quản lý tại Việt Nam.
gas emissions, raw material management, water and energy
Từ khóa: Báo cáo ESG; triển khai ESG; phát triển bền vững. consumption, and compliance with environmental
protection laws, employee-related policies, behaviors
1
Foreign Trade University, Vietnam toward the local community, and reports related to green
*
Email: [email protected] capital market activities.
Received: 31/8/2023 According to the “Vietnam EGS Readiness Report 2022”,
Revised: 05/10/2023 ESG is still not a well-known term in Vietnam since the
Accepted: 25/11/2023 regulations only require listed companies on the stock
market to disclose sustainability information, while non-
listed companies do not seem to be ready for integrating it.
1. INTRODUCTION
ESG-related studies in Vietnam mainly focus on the
Recently, there has been a significant increase in relationship between sustainability information and
awareness of sustainable value creation among all business financial performance to prove the need to integrate ESG
stakeholders, who are eager to act more responsibly in information or determine factors influencing the level of ESG

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information disclosure. As Vietnam is still at the beginning economic, and social aspects, and it also allows comparisons
stage where ESG knowledge has just started to spread, it is between companies. GRI’s standard requires public country-
important to conduct more research on preparing and by-country reporting of taxes paid by a multinational
presenting ESG reports so that they can be done easily and corporation. Such disclosure would sharply increase
effectively by not only large corporations but also SMEs. transparency for taxing jurisdictions and have the potential
2. THEORETICAL BACKGROUND to discourage aggressive tax avoidance. However, the report
format is relatively complicated, which makes it difficult for
ESG information is defined by environmental, social, and
small enterprises to follow.
governance aspects. "Environment" refers to the impacts of
humans on the ecosystem, according to [11], who described International Integrated Reporting Council (IIRC)
sustainable development as "meeting the needs of the IIRC’s framework for integrated reporting intends to
present generation without affecting future generations." elevate the information standard for the capital holder to
Information on environmental sustainability is expressed make more efficient decisions in allocating capital. While
using the following criteria: (1) environmentally friendly, acknowledging that there are other types of capital, the IIRC
recyclable, and reused materials; (2) the consumption of specifically targets sources of financial capital. It has
water, energy, and natural resources; (3) policies to reduce succeeded in simplifying the mandatory statement of
energy consumption, waste and waste treatment, and air responsibility for the integrated report and has placed a
pollution levels during production and business [5]. greater emphasis on the balanced reporting of outcomes
Elkington defined "social sustainability" as long-term and value preservation and erosion scenarios. However, the
actions that have an impact on community well-being [2]. major focus on shareholders has made IIRC tend to lack
The GRI considers social, economic, and environmental standards on tax transparency.
factors to be three crucial factors in sustainability reports. It Task Force on Climate-related Financial Disclosures
also lists the parts of a firm, even if it does not define social (TCFD)
performance [12]. These activities include charitable giving In order to provide a standardized framework for
to the community, fighting social injustice, upholding businesses to utilize when making financial disclosures
human rights, improving employee benefits, including linked to climate-related matters, the Financial Stability
training and health care, ensuring workplace safety Board established TCFD in 2015. It provides corporations
statistics, and a dedication to non-discrimination. with more detailed information on climate-related risks,
Corporate governance (CG), according to [1], examines guides a more standardized approach to integrating climate
how organizations are run, governed, and controlled. It is factors into financial reporting, and encourages institutions
the process through which organizations react to the rights to integrate climate-related information into decision-
and preferences of interested parties. Gourevitch and Shinn making. However, it tends to put more emphasis on the
defined CG as "the structure of authorities in the firm; that is short-term aspects than the long-term power, and it might
what lies at the heart of the most important problems in the be too focused on climate issues and could potentially
company," such as those who have significant control over weigh other issues lightly.
the cash flow, the strategy, and the resources of the 3. ESG REPORTING IMPLEMENTATION IN VIETNAM
company [4]. CG is affected by social mobility, stability, and
liquidity. According to GRI, CG disclosure level depends on 3.1. Background and regulations in Vietnam
the firm’s volition. Vietnam, a developing country with a high economic
In summary, ESG reporting is the formal disclosure and development index, has been actively working towards
communication of a firm's sustainability goals, recognized sustainable development. The country has set 17
more specifically as its environmental, social, and sustainable development goals based on the United
governance goals, as well as its progress toward achieving Nations' principle of “No one is left behind”. Vietnamese
those goals. companies are also adopting ESG as a trend, with 325
investors surveyed worldwide placing a high priority on ESG
The rapid growth in ESG awareness comes along with the objectives in their investments. High ESG performance has
evolution of various frameworks aiming to address ESG. The been found to have higher returns and lower risk.
most popular frameworks used are GRI, TCFD, and IIRC. Each Vietnamese companies are now adopting ESG practices and
has its own strengths and weaknesses. issuing sustainability reports that align with the global
Global Reporting Initiative (GRI) trend. This commitment to long-term sustainable
GRI is the most widely used framework for reporting. development offers companies not only a way to minimize
GRI’s target audience includes investors, customers, brand risk but also a chance to improve business models and
employees, and civil society. The goal of GRI is "to empower contribute to society. ESG is becoming a more important
decisions that create social, environmental, and economic factor for investors when making investment decisions,
benefits for everyone". It provides different sets of indicators particularly in the case of capital from Europe and
that allow a deeper understanding of environmental, developed nations. Companies with reliable ESG reporting

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and procedures will have additional advantages when development and achieve net zero emissions by 2050.
obtaining funding. Incorporating ESG can help firms decrease risks and
The State Securities Commission of Vietnam released participate in the supply chain. According to a PwC
Circular No. 155/2015/TT-BTC in 2015, contributing to Vietnam survey, 80% of enterprises anticipate increasing
corporate knowledge of the necessity of sustainability their commitment to ESG over the next two to four years.
reports. Vietnam committed to a net zero emissions However, 57% of foreign direct investment firms have
objective at COP26, inspiring all levels of government and made explicit promises on ESG, while listed enterprises in
businesses to collaborate. The development plan for 2021- Vietnam claim they intend to make an ESG commitment
2030 focuses on ensuring social security, well-being, and soon. The survey found that only 22% of the 66% of
sustainable resource management, with environmental businesses that have implemented an ESG program
protection and public health as primary objectives. The claimed to have a comprehensive plan, while 35% had
Ministry of Finance in Vietnam has released Circular No. active leadership participation in the program.
96/2020/TT-BTC, which outlines rules for ESG reporting for Additionally, only 28% of businesses have integrated risk
public firms listed on the stock exchange. These companies indicators to track ESG implementation, 35% don't have
are required to publish annual ESG reports covering topics any ESG-related initiatives, and 71% lack the knowledge
such as greenhouse gas emissions, raw material necessary to report ESG. SMEs make up 60% of the
management, energy consumption, environmental companies that have not yet committed to ESG,
protection laws, employee policies, community highlighting the need for the Vietnamese government and
responsibility, and green capital market activities. SME groups to engage in active conversations. Clear
Businesses with annual revenues of more than 100 billion norms, a broad national roadmap, and level playing fields
VND are required by law to disclose ESG. The Ministry of for industries are necessary to help companies develop
Planning and Investment has also published Program 167 ESG policies.
on supporting the sustainable development of companies in 3.2.2. ESG implementation in Vietnam Dairy Products
the period of 2022-2025. Joint Stock Company
The Ho Chi Minh Stock Exchange (HOSE) introduced the Vinamilk is a pioneer in Vietnam's movement towards
Vietnam Sustainability Index (VNSI) on July 21, 2017, in ecologically and sustainably friendly development, focusing
partnership with the State Securities Commission of on sustainable development and corporate governance.
Vietnam (SSC) and the German Organization for The company has been listed as one of Vietnam's Top 10
International Cooperation (GIZ). The VNSI aims to provide Sustainable Development Enterprises in the manufacturing
sustainable development standards for publicly traded sector for six years. Vinamilk began publishing the
companies, assist institutional and private investors in Sustainable Development Report in 2012, referencing the
locating businesses with "green" characteristics for financial GRI Standards and the United Nations' Sustainable
investment objectives, and promote sustainable Development Goals. The company has implemented
development across the economy. However, Vietnam lacks sophisticated and environmentally friendly technology,
a clear and unified set of standards for information including solar power and biomass, in its manufacturing
disclosure, making it challenging for investors and partners facilities. Vinamilk has established 13 farms that adhere to
to evaluate the performance of enterprises. The business international standards, including EU organic requirements.
side also struggles to decide which indicators should be In 2021, Vinamilk introduced the eco-friendly Green Farm
monitored. system, which has received high praise for its initiatives and
3.2. Illustrations of ESG reports in Vietnamese best practices in sustainable development in the dairy
industry. Vinamilk has defined four major strategic
enterprises
orientations for the five-year period from 2022 to 2026,
3.2.1. Overview including promoting the application of technology to
ESG is crucial for sustainable development, especially in sustainable agriculture.
Vietnam, which is at risk of experiencing climate change In November 2022, Vinamilk signed a memorandum of
effects and losing 14.5 percent of its GDP in 2050. Vietnam's understanding with the Natural Resources and Environment
potential to attract $753 billion in climate investment Newspaper, implementing tree planting to achieve carbon
between 2016 and 2030 gives companies that promptly neutrality and move toward Net Zero. This project is part of
create and implement ESG standards significant benefits Vinamilk's Action Program towards Net Zero 2050, which
and market opportunities. The G7 has pledged to spend 15.5 aims to reduce net emissions to zero," as Vietnam pledged
billion USD less on coal, and Vietnam has ranked second in at the United Nations Climate Change Summit in 2021.
ASEAN for green bond issuance in 2021 with $1.5 billion, up Vinamilk has been recognized as the business with the
five times from 2020. highest standard of employee care and consistently tops the
The government of Vietnam and enterprises are lists of good employers by Career Builder and Alphabet. The
stepping up their efforts to promote sustainable management structure of Vinamilk is made up of highly

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qualified managers with years of experience operating GRI 200 - Economic performance 1 1
under strict ethical guidelines. Economics Market presence 1 1
3.2.3. ESG implementation in Bao Viet Group
Indirect economy impacts 1 1
Bao Viet in Vietnam prioritizes sustainable development
through various initiatives, including incorporating ESG Anti-corruption 1 1
factors into investment processes, selecting contractors Procurement Practices 1 1
with environmental commitments, and demonstrating a
humane business perspective. In 2019, the company Tax 1 0
donated VND 30 billion to social security operations, GRI 300 - Materials 1 0
addressing natural disasters and climate change. Baoviet environment Energy 1 1
also engages in community activities, such as cleaning
marine environments and planting trees. The group's direct Water and Effluents 1 1
environmental impacts are minimal due to its financial Biodiversity 1 0
services sector. However, Baoviet addresses environmental
challenges within buildings and investment projects, Emission 1 1
focusing on energy, emissions, wastewater, and Waste 1 1
environmental compliance. The company believes
businesses must continue to act responsibly by complying Environment compliance 0 1
with regulations, controlling pollution, treating and Supplier Environmental 1 0
recycling waste, and conserving resources. Assessment
3.2.4. Compliance of Vietnamese enterprises’ ESG GRI 400 – Employment 1 1
reports with international framework Social Labor/Management 1 0
To assess the compliance of Vietnamese enterprises’ ESG Relations
reports with the international framework, we compared the
ESG reports of Vinamilk and Bao Viet Group to one of the Occupational Health and 1 1
most frequently used international standards, the GRI, Safety
revised in 2021. Training and Education 1 1
Vinamilk has the highest level of compliance with GRI Diversity and Equal 1 1
standards, with 27 out of the 28 elements provided in the Opportunity
report. Bao Viet Group has a compliance rate of over 70%.
The three companies have a combined wealth of experience Non-discrimination 1 1
in releasing content on sustainable development and Local community 1 1
explicit plans to enhance the reports over the coming years.
Customer Privacy 1 0
Vinamilk's 2022 sustainable development report is well
presented, meets GRI requirements, and discloses general Freedom of Association 1 1
standards and most standards under economics, and Collective Bargaining
environment, and society. The company has formed a local Supplier Social 1 0
expert group to engage with stakeholders and reports Assessment
approximately 20 GRI indicators audited by PwC Vietnam.
Bao Viet Group, like Vinamilk, has been producing GRI-based Customer Health and 1 1
sustainability reports for over ten years and presents and Safety
analyzes the information using GRI rules and criteria. The Marketing and Labeling 1 0
report includes financial and non-financial information,
Total 27/28 20/28
including development strategy, corporate governance
quality, social activities, and the environment. Bao Viet is the Source: Compiled by authors
first Vietnamese company to be officially acknowledged for 4. SUGGESTED ESG INDICATORS FOR REPORTING
rating a sustainable business in the Down Jones As described above, each framework has its own pros
Sustainability Indices in March 2023. and cons, and the choice of framework depends on the
Table 1. ESG reports of Vinamilk and Bao Viet Group in comparison with GRI regulations of each country and other macro and
standard microeconomic factors. In the context of Vietnamese
Standard No. Standard Title Vinamilk Bao Viet Group enterprises, ESG determinants should be relevant,
collectible, reliable, and understandable. The proposed
GRI 2 General Disclosure 1 1 indicators have been selected and synthesized from diverse
GRI 3 Material Topics 1 1 sources and are mainly based on the GRI framework because

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it has been considered the most acceptable framework until Effluents and Waste
now and the government also promotes it. EN13 Total waste Kg
4.1. Regarding the Environmental aspect EN14 Total hazardous waste Kg
Environmental key performance indicators (KPIs) are Compliance with legislation**
inherited from the research of [6]. They are quantitative EN15 The monetary value of VND
indicators that show the progress of a company in attaining significant fines and the
its vision. By combining different organizational levels total number of non-
(enterprise units, departments, and individuals) with clearly monetary sanctions for
de ned objectives and benchmarks for certain economic non-compliance with
activities, these environmental KPIs will assist rms in environmental laws and
turning their strategy into practice. regulations
Table 2. List of proposed Environmental Indicators Source: Compiled by authors
Unit of Corporate Industry 4.2. Regarding the Social aspect
No. Indicators
measurement value value
The suggested social determinants are selected from the
The efficiency of material consumption ISO 26000 and IFAC data, with some correspondence to the
EN1 Annual mass-flow of Tons GRI indicators. ISO 26000 addresses seven core subjects:
different materials used organizational governance, human rights, labor practices, the
EN2 Percentage of recyclable % environment, fair operating practices, consumer issues,
materials as of total community involvement, and development. From IFAC, the
input material following core subjects were used: workplace health and
Energy safety; human capital development (training and
EN3 Percentage of energy in % qualification); human capital management (staff turnover and
kWh from renewable maturity); diversity; and absenteeism.
energy sources as of Table 3. List of Selected Social Indicators
total energy consumed
Corporate
EN4 Energy consumption kWh/ product or No. Indicators Source
description
per unit of revenue/ unit of revenue
unit of product Employment
Water SO1 Total workforce by employment type, [5, 7]
EN5 Total water m3 employment contract, and region,
consumption broken down by gender.
EN6 The total amount of m3 SO2 Total number and rate of new employee
circulating and reused hires and employee turnover by age
water group, gender, and region
Biodiversity Occupational Health and Safety
EN7 Total use of land m² of built-up
SO3 Rates of injury, occupational diseases, [5, 7]
area use of land
lost days, absenteeism, and total number
EN8 Total investment in VND of work-related fatalities, by region and
biodiversity protection by gender.
campaigns
SO4 Education, training, counseling,
Emissions*
prevention, and risk-control programs
EN9 Total Greenhouse Tons of are in place to assist workforce members,
gasses (GHG) emissions equivalent CO2 their families, or community members
regarding serious diseases.
EN10 Total GHG emissions Tons CO2
per product or unit of equivalent per Training and Education
revenue product or unit of SO5 Average hours of training per year per [5, 7]
revenue employee, by gender, and by employee
EN11 Total emissions of Tons CFC-11 category.
ozone-depleting equivalent SO6 Percentage of employees receiving regular [5]
substances (ODS) performance and career development
EN12 Other significant air Kg reviews, by gender.
emissions

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Diversity and Equal Opportunity acknowledged document without a clearly de ned sphere
SO7 Composition of governance bodies and [5, 7] of activity that individual nations might adopt freely. The
breakdown of employees per employee OECD Principles of Corporate Governance are among the
category according to gender, age group, fundamental papers (Kislingerová and Nov, 2005). The
minority group membership, and other development of corporate governance performance
indicators of diversity. indicators was based on an empirical examination of the
OECD's (2004) and the International Federation of
SO8 The ratio of basic salary and remuneration
of women to men by employee category, Accountants (2012) codes of corporate governance.
by significant locations of operation. Table 4. List of Selected Indicators for Corporate Governance
Human Rights Corporate
No. Indicators Source
SO9 Total and percentage of activities [5] description
requiring a human rights review or Governance Structure
human rights impact assessment, by CG1 Existence of a dedicated Board [3]
country Committee for Environmental
SO10 Operations and significant suppliers Social (ES) issue
identified as having significant risk for CG2 The ES experience of Board [3]
incidents of child labor/forced members
labor/Indigenous people CG3 Percentage representation of Corporate
Customer Health and Safety the independent members Governance and
SO11 Percentage of key product or service [5] Management Code
categories that have had their health and CG4 Company structure Corporate
safety impact assessed for improvement Governance and
Product Responsibility Management Code
SO12 Type of product and service information [5] CG5 Number of members from the Green Book
required by procedures and percentage of point of the professional
significant products and services subject to competences
such information requirements. CG6 The independence between the Corporate
SO13 Total number of substantiated complaints Board of Directors and the Governance and
regarding breaches of customer privacy subcommittees in the enterprise Management Code
and losses of customer data CG7 Separation of the position of [7]
Marketing Communications CEO/chairman
SO14 Programs for adherence to laws, [5] CG8 Risk management, ethical [7]
standards, and voluntary codes related to behaviors of the Board of
marketing communications, including Directors
advertising, promotion, and sponsorship Stakeholder engagement
Compliance CG9 Ensure shareholder rights and [7]
SO15 The monetary value of significant fines [5] ensure fair treatment for all
for non-compliance with laws and shareholders
regulations concerning the provision and CG10 Existence of the mechanisms [7]
use of products and services. of the involvement of the
stakeholders
Source: Compiled by authors
CG11 Frequency of the involvement [7]
4.3. Regarding the Governance aspect of the stakeholders
Corporate governance guidelines are drawn from both Information disclosure
regulations and codes of conduct in accordance with CG12 Fully and accurately disclose [5]
national traditions. The legal foundation for corporate information about the
governance is established within the context of adhering to company's financial results,
national directives and regulations (Code of Criminal objectives, change of
Responsibility, Code of Business Activities on the Financial ownership structure, etc.
Markets, Commercial Law, Principles of Auditors, and Bank
CG13 Disclosure of information [7]
Law) as well as other codices about the transparency of the
related to salary and bonus of
listed corporation, the rights of shareholders, market
the Board of Directors, Board
exploitation, and the audit. Among them, the OECD
of Directors
Principles are the product of an effort to create a globally

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Compliance survey are likely or certain to report information related to

CG14 Total sum spent on the [7] material used, water consumption, workforce, and company
correction, penalties, expenses, structure. The result for common indicators reflects a high
and putting out of operation level of feasibility since most indicators are linked directly to
business operations and necessary for cost accounting.
Source: Compiled by authors
Hence, such indicators are available and could be reported
5. FEASIBILITY OF INTEGRATING THE PROPOSED ESG easily.
REPORTS IN VIETNAM According to the results, reporting on environmental
5.1. For large corporations and social indicators was often more challenging than
To examine the ability to implement the suggested ESG reporting on economic and institutional data. The ability to
report in large Vietnamese companies, we assessed the report the following determinants was singled out as being
sustainability reports of Vinamilk and Bao Viet Group by challenging in several situations:
comparing their current criteria to the ones suggested EN6: The total amount of circulating and reused water
above. The results showed that both Vinamilk and Bao Viet EN11: Total emissions of ozone-depleting substances
groups can easily adapt to the suggested report as the (ODS)
percentage of disclosure is above 70%. High compliance
ratios imply the feasibility of integrating ESG reports into SO10: Operations and significant suppliers identified as
large Vietnamese corporations. It is due to the fact that having significant risk for incidents of child labor, forced
Vinamilk and Bao Viet Group prepared their reports closely labor, or indigenous people
to the GRI guidelines and even got their reports reviewed by An index like ODS is unfamiliar and not as popular as
independent parties. For other large enterprises, especially carbon dioxide, so businesses do not have available data to
listed firms on the Vietnamese stock market, it is feasible to measure it. As for social factors, it is not easy to assess
prepare ESG reports because they are currently required to external parties such as suppliers.
disclose sustainable development information following the Regarding other measures, there is no systematic
guidelines of Circular No. 155/2015/TT-BTC. This proves that uniformity among the firms. For instance, the following
large companies under pressure from the government and indicators were noted as being difficult or currently
shareholders have little difficulty integrating ESG into their impossible to report in certain circumstances but available
reports. Moreover, since listed companies have abundant in the majority of other cases:
capital and resources to measure according to prescribed EN2: Percentage of the used recycled input materials as
standards, it is possible to apply ESG in a standardized way. of the total input material
5.2. For SMEs CG1: Existence of a dedicated Board Committee for
To assess the feasibility of integrating ESG, we created a Environmental and Social (ES) Issues
questionnaire to examine whether different companies In most enterprises, there is a board of management to
from different industries have available data for ESG oversee corporate governance. However, they have not had
reporting. The questionnaire was sent to participating a specific board or committee to be in charge of reporting
companies with full suggested indicators, and then the on ES issues and assessing the sustainability process since
company chose the possibility of reporting these indicators the cost to operate it could be significant and beyond the
at present on a 5-point Likert scale from 1 (impossible), 2 benefit when the company has not had any plans for
(unlikely), 3 (even), 4 (likely), and 5 (certain). The survey was sustainability reporting.
conducted among 140 Vietnamese SMEs with a broad range
Companies claimed a lack of regulatory obligations,
of industries, locations, and ownership types.
technical assistance, data collection skills, and measurement
The findings indicated that most observed companies skills as the primary reasons why key indicators were not
could present information on the major key indicators. disclosed. According to GRI guidelines, the measuring
Irrespective of an entity's size, industry, or location, the key system DJSI is "not suitable for small and medium-sized
indicators have been designed to be general. For example, enterprises because of its complexity, limited flexibility, and
the following indicators were already available as part of many procedures". For SMEs, a simplified report version with
company data: more basic indicators should be considered.
EN1: Annual mass flow of different materials used 6. RECOMMENDATIONS AND CONCLUSION
EN5: Total water consumption 6.1. For large corporations
SO1: Total workforce by employment type, employment Because large corporations already had an overview of
contract, and region, broken down by gender ESG reports and certain data available for reporting, they
CG4: Company structure should now focus on strategic development and the quality
All of the indicators above have an average possibility of information. Enterprises should go beyond just disclosing
over 4, which means all companies participating in the figures to stakeholders; rather, they should focus on value

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creation as a strategy and, with discipline, follow a economy. Businesses that invest in a circular economy
consistent methodology or blueprint to select, execute, and should be given government grants because the investment
integrate sustainable development into their business. is often higher than usual. A validation mechanism can be
6.2. For SMEs developed to validate the information that businesses
submit.
SMEs need to clarify the responsibility of ESG governance
at all levels of the company. The Board of Directors needs to The Vietnamese government is committed to achieving
create an ESG strategy while the Board of Management sustainable development goals and recognizing the
implements and monitors ESG plans in reality. Employees significance of ESG data from enterprises. Vietnamese
are those who practice ESG activities in their daily tasks. businesses have made progress in implementing ESG for
Therefore, it is necessary to create an understanding of the various reasons, such as brand enhancement, increased
important role of ESG for employees, increasing the need to market rivalry, and stakeholder pressure. However,
cultivate knowledge about sustainable development. After obstacles remain, such as unclear guidelines and unclear
providing employees with the mindset of ESG, enterprises business paths. To address the lack of standardization in ESG
need to implement specific measures to fulfill commitments metrics and reporting, firms can collaborate with peers and
and turn beliefs into actions in the blueprint for the future: stakeholders to develop uniform reporting formats and KPIs.
Firstly, to build an effective ESG strategy, businesses need
to be able to acknowledge the true value of the ESG aspect
for their business future.
Secondly, ESG conversion must be executed REFERENCES
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in the future. THÔNG TIN TÁC GIẢ
In addition, there should be a reasonable tax policy, Nguyễn Thị Phương Mai, Nguyễn Ngọc Huyền
giving priority to businesses investing in the circular Trường Đại học Ngoại Thương

158 Journal of SCIENCE & TECHNOLOGY ● Vol. 59 - No. 6B (Nov 2023) Website: https://jst-haui.vn