Quick answer
ESG stands for environmental, social and governance, the three areas investors, lenders, customers and regulators now look at alongside financial results. Health and safety sits mainly in two of them. How a business protects its workers is a core social measure and how its directors and officers oversee that risk is a governance measure. In New Zealand the Health and Safety at Work Act 2015 already requires officers to exercise due diligence. A board that can show it's meeting that duty has a large part of the social and governance story in hand.
Ask most boards what ESG means and you'll get an answer about carbon. Tim Jones runs Grow Good, a consultancy that helps businesses through B Corp certification. When he came on Health & Safety Unplugged he made the case that ESG is going the same way health and safety went when the Act came in: from a side job for someone with a tenth of their time spare to part of how the business is run.
This post covers what ESG is, why it has reached medium-sized businesses that never expected to hear about it, where health and safety fits and what a B Corp assessment tends to find. The episode went out in November 2023. I've added what has changed since, including new B Corp standards and changes to the climate reporting rules.
What Is ESG?
ESG is a way of judging a business on how it makes its money as well as how much it makes. Different frameworks measure it in different ways, however most look at the same three areas.
| Area | What it covers | Where health and safety shows up |
|---|---|---|
| Environmental | Emissions, energy, waste, pollution and the products a business makes | Hazardous substances, safer product choices, contamination |
| Social | Workers, suppliers, customers and communities | Worker health, safety and wellbeing, contractor safety, conditions in the supply chain |
| Governance | How the business is directed, controlled and held to account | Officer due diligence, board reporting, ethics and whistleblowing |
Tim's view was that the frameworks all come back to one question. Make your money, he said, however think about the effect on everyone else while you're doing it. His example was a chief executive facing a tight month who could cut half the staff. The ESG question is what that does to those people, their families and their community. Then it asks whether the business can hold on another couple of months.
Why ESG Has Reached Medium-Sized NZ Businesses
Most of the formal rules apply to the biggest organisations. Since 2023 larger listed companies, banks, insurers and investment managers have had to publish climate-related disclosures under the Financial Markets Conduct Act 2013, with the first reports published in 2024. In October 2025 the government announced it would narrow the regime, lifting the threshold for listed companies from a market capitalisation of $60 million to $1 billion and removing investment scheme managers. The Financial Markets Conduct Amendment Bill making those changes hadn't passed when Parliament rose for the November 2026 election. The Financial Markets Authority has extended its no-action relief for the affected entities while the incoming government decides what to do.
The pressure Tim saw didn't come from the law directly. It came down the supply chain. A large company that has to report on its impact wants to know what its suppliers are doing, even a one-person consultancy that has done a single job for it. He described a construction supplier in Penrose whose weekly meeting with a major infrastructure client started with 20 minutes on ESG before anyone got to delivery dates. That supplier came to Tim wanting B Corp certification and he admitted he'd never have predicted it.
Directors also have more room to think this way than they used to. Since August 2023 section 131 of the Companies Act 1993 has said that a director acting in the best interests of the company may consider matters other than maximising profit, with environmental, social and governance matters given as examples.
Where Health and Safety Fits in ESG
Health and safety is one of the most established parts of ESG in New Zealand law. The social pillar asks whether a business looks after its people. The Health and Safety at Work Act 2015 has required a business to ensure the health and safety of its workers so far as is reasonably practicable since April 2016. The governance pillar asks whether the people at the top are on top of the risk. Section 44 of the same Act requires officers to exercise due diligence. That includes keeping up to date on health and safety, understanding the work and its hazards and risks, making sure the business has the resources and processes to manage them and verifying that those resources and processes are actually being used.
| ESG question | The health and safety duty behind it |
|---|---|
| Does the business look after its workers? | The primary duty of care, section 36 |
| Is the board on top of its most serious risks? | Officer due diligence, section 44 |
| Do workers have a voice? | Worker engagement and participation, sections 58 and 61 |
| Does the business work safely with the contractors and other businesses it shares work with? | Overlapping duties to consult, cooperate and coordinate, section 34 |
That's why I see health and safety as the easiest win in ESG for most New Zealand businesses. The duties are already law and many businesses already hold some of the evidence. What's often missing is the governance piece. In my experience the officers of a business, whether that's a board or an owner and a couple of their mates, often can't demonstrate that they understand their duty. Tim had seen the same thing from the ESG side. When he's brought into board meetings as part of a client's B Corp work, he sees directors reading the papers as they sit down and questions that are usually about the balance sheet or something tactical.
What a B Corp Assessment Tends to Find
Tim reckoned about 80 per cent of the businesses he worked with were already acting the way a B Corp would, they just hadn't written it down or kept the data to prove it. His example was a skincare business whose two founders both knew staff could take as much annual leave as they needed. Nobody else in the company knew because it wasn't written down. The other 20 per cent had decided to change how they operate and were starting closer to scratch.
The gaps he found most often in medium-sized businesses were:
- No code of ethics or whistleblower policy, usually because the business has grown fast and nobody has had time to tighten things up.
- Little visibility of the supply chain beyond the first supplier.
- No formal quality assurance programme.
- Good practice that happens but isn't documented and can't be proven.
Health and safety questions scaled with the size and type of business. Tim explained that a manufacturer with more than a thousand staff answered far more of them than a small consultancy with no machinery. He also pointed to a disclosure question on the version of the assessment we discussed, asking whether the business had a workplace fatality in the previous five years.
B Corp certification has changed since the episode. Under the assessment Tim described, a business needed 80 points out of 200 across five areas. In April 2025 B Lab published new standards that drop the points total in favour of minimum requirements across seven impact topics, with more requirements added at three and five years. From 2026 B Lab began certifying and recertifying businesses against the new standards. B Lab's 2024/25 annual report counted 175 B Corps in Aotearoa.
Purpose Clauses, Stakeholders and the Board
To certify, a B Corp in most countries has to change its constitution to add a purpose clause and a stakeholder clause. The first says the company has a purpose beyond profit. The second requires its directors to consider the effect of its operations on workers, customers, the community and the environment. Tim's point at the time was that there was no training on how to govern that way. Maximising profit is what directors are taught everywhere else.
The stakeholder idea isn't new to health and safety people either. ISO 45001 asks a business to identify its interested parties, their needs and expectations and which of those are or could become legal requirements. When we put that in front of clients, the response is often to ask why they need a stakeholder register at all. My answer is that the register is a list of the people your risk affects. Tim had found the same thing. Most businesses he worked with hadn't mapped their stakeholders or asked them what matters.
I also used the conversation to challenge my own profession. Too often the senior health and safety person hovers outside the boardroom, called in to explain an accident and then sent out again. I don't think the value is in spending a week on a board report that gets skimmed. It's in making it safe for the board and executive to have hard conversations about risk before something goes wrong.
Safer Substitutes: Good ESG and Good Health and Safety
The example from our conversation I'd use with any board was that Penrose supplier again. The industry standard for one of its sealant products was highly toxic. The business sourced a water-based version with no toxins instead. Tim talked about the pride the team took in it, even though the toxic product would probably have been cheaper to import.
To a health and safety person that's substitution, one of the most effective controls in the hierarchy. It removes a hazard for the people making, handling and using the product and reduces harm to the environment at the same time. When ESG and health and safety teams work together you get more decisions like that. I expect health and safety, environmental and quality roles to spend a lot more time together.
What Boards Should Ask About ESG and Health and Safety
These are the questions I'd want a board to be able to answer.
- Which of our customers, lenders or investors are asking about ESG and what are they asking for?
- Can we show how we meet our officer due diligence duty or do we only believe we do?
- Who are our stakeholders, including workers and contractors? Have we asked them what matters?
- Do we know the conditions and safety practices of our key suppliers?
- Do we have a code of ethics and a way for people to raise concerns safely?
- Is health and safety reporting to the board about critical risks or only about injury numbers?
- Are our health and safety, environmental and quality people working together or in separate corners?
If you'd like a structured way to test the governance side, the free Officer Verification Worksheet walks through what each officer should be able to show. My officer due diligence checklist for NZ directors covers the duty in more detail.
Watch the full conversation with Tim Jones on Health & Safety Unplugged below.
Frequently Asked Questions About ESG and Health and Safety
What does ESG stand for?
Environmental, social and governance. They're the three areas used to judge how a business operates and what effect it has, alongside its financial results.
Is health and safety part of ESG?
Yes. Worker health and safety is a core social measure and how directors and officers oversee health and safety risk is a governance measure.
Do New Zealand businesses have to report on ESG?
Only some. Larger listed companies, banks, insurers and investment managers have to publish climate-related disclosures, although the government has proposed narrowing that group. Most other businesses don't have a legal ESG reporting duty, however larger customers and lenders increasingly ask their suppliers for ESG information.
Can NZ directors consider ESG factors?
Yes. Since August 2023 section 131 of the Companies Act 1993 has said directors may consider matters other than maximising profit, such as environmental, social and governance matters, when acting in the best interests of the company.
What is a B Corp?
A business certified by the nonprofit B Lab as meeting its standards for social and environmental performance, accountability and transparency. Certified businesses also change their constitution to commit to considering all their stakeholders.
How does officer due diligence relate to ESG?
Officer due diligence under section 44 of the Health and Safety at Work Act 2015 is a governance duty. A board that can show how it oversees health and safety risk has evidence for the governance side of ESG as well as the social side.
Sources: Health and Safety at Work Act 2015, sections 34, 36, 44, 58 and 61; Companies (Directors’ Duties) Amendment Act 2023; MBIE, Capital markets changes to boost business growth (October 2025); NZ Lawyer, FMA extends no-action relief for climate reporting entities (October 2026); B Lab, new B Corp standards (April 2025); B Lab Aotearoa New Zealand, Australia, Annual Report 2024/25; Health & Safety Unplugged, episode with Tim Jones. This post is general guidance, not legal advice.
About the Author
Matt Jones is the founder of Advanced Safety and a HASANZ-registered health and safety consultant. He's a Professional Member of NZISM and holds a Graduate Diploma in Occupational Safety and Health.
He advises boards, directors and executives on officer due diligence and critical risk under the Health and Safety at Work Act 2015. His book Raise the Standard: Why Good Organisations Go Blind and How Leaders Restore Visibility sets out G.A.P.E.™, F.E.E.D.™ and S.A.F.E.T.Y.™, a leadership architecture framework for high-risk organisations.
He created the Compliance Compass audit and hosts the Health & Safety Unplugged podcast.
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