Last year we joined forces with Shift, the leading center of expertise on the UN Guiding Principles on Business and Human Rights to develop an accounting model that companies can use to measure and report on progress towards living wages across their workforces and supply chains.
This project seeks to use the power of financial accounting to build important new incentives for companies to take an active role in tackling inequalities for people in workplaces and supply chains who earn less than a living wage.
We aim to design a model that helps both businesses and standard setters. For companies, it must help to show the value both to society and to businesses of paying living wages. For regulators, it must be able of integrate into accounting and reporting standards as part of the developments in sustainability disclosures.
We are now seeking companies to step forward and pilot an accounting model to report their progress towards living wages and the benefits this creates for them.
The accounting model was developed through an in-depth process of consultation and iteration involving over 80 stakeholders. The model is divided into two parts: first, a set of basic disclosures that are aimed at being adopted by standard setters as part of a companies’ public reporting on wages, or on the income-related drivers of inequality more generally. Second, a more advanced set of estimates of the erosion of human capital that results from paying below living wages and the regeneration of value that results from reducing the living wage deficit.
Piloting will take place between May and September 2022 and will be based on existing data held by companies. Interested companies should contact email@example.com to register interest or to find out more.