Columbia Steel’s Investment in the Social Aspect of ESG
There was a time, not so long ago, when a company’s financial performance was the only thing that mattered. Investors didn’t care much about how companies treated the environment or their employees so long as they delivered increasing shareholder value. As a result, some bad actors were able to run very profitable enterprises that caused measurable harm to their communities.
However, as the public has become more concerned about issues of social responsibility over the years, many people now prefer to consciously invest in companies that behave appropriately rather than blindly supporting those that don’t. Unfortunately, measuring performance outside of the financial realm isn’t always straightforward, particularly regarding intangible issues like ethics or sustainability.
ESG Explained
To fill this gap, investors developed the environmental, social, and governance framework — more commonly known as ESG — to judge a company’s performance in impact areas outside of finance. Here is a simplistic breakdown of the criteria found within the three ESG categories:
> Environmental criteria cover the resources companies consume, the waste they emit, and their impact on the larger community. Key elements of environmental measures include carbon emissions and climate change.
> Social criteria include the way companies interact with people and institutions in the communities where they operate. The social criteria also encompass issues like diversity, equity and inclusion.
> Governance criteria address the systems and practices companies use for decision-making and self-governance.
Currently, ESG metrics aren’t a required component of mandatory financial reporting. However, a growing number of companies include ESG information in their regular reporting because investors are increasingly using these factors to judge both risk and growth potential.
Social Criteria at Columbia Steel
As a family-owned business for three generations, Columbia Steel has integrated ESG considerations into our daily operations. For example, we select production materials that are safe for our employees. Most of our molding is accomplished with recycled olivine sand, Western Bentonite clay, corn cereal and water. We have worked towards reducing our environmental impact, undertaking significant projects to decrease our water and electrical consumption. Moreover, every day we recycle as much as one million gallons of water, up to 50 tons of scrap steel and 200 tons of sand.
Even as we place a high priority on monitoring our environmental impact, which includes active participation in DEQ’s Cleaner Air Oregon program, social criteria are core to our corporate values. Those criteria include:
Generous Employee Benefits
We want our employees to thrive on and off the job. We pursue that goal by providing family-wage jobs, low-cost health insurance, a company-run 401(k) program, educational reimbursements and ample opportunities for internal advancement. We see signs of our success in the people who’ve worked here for 30, 40 and 50 years, along with an abundance of second and even third-generation employees. We believe that investing in our team is also an investment in our business.
Investments in Physical Health and Safety
A manufacturing environment is inherently riskier than other occupations, which is why we go the extra mile to protect our team’s health and safety. These efforts include developing a culture of safety through rigorous training, investing in top-of-the-line safety equipment and working collaboratively with local government agencies like the Oregon Occupational Safety and Health Administration (OSHA) and the State Accident Insurance Fund (SAIF).
Positive Labor Relations
The majority of our employees are either members of United Steelworkers Local 139B or the Portland Pattern Makers Association. We believe it’s critical to maintain a positive and collaborative relationship with union leaders to benefit both staff and the company. Organized labor built the middle class, and we’re proud of the role we’ve taken in helping thousands of employees find a piece of the American Dream.
Diversity, Equity and Inclusion
We’re also proud of our diverse workforce, which brings added strength to our company. Currently, 22% of our employees identify as Hispanic and another 11% as non-white. We have a strong commitment to welcome people of all backgrounds. That’s why we’ve made it a priority to ensure that today and into the future our doors are open to offer working-wage jobs for people in our community.
Rethinking “Value”
The rise of ESG has provided investors with a refreshed framework for their purchasing decisions, and it’s also pushed companies to rethink what the word “value” really means. Instead of strictly being applied to profit, value now encompasses the depth and breadth of a company’s existence. Under an ESG mindset, expenditures on things like conservation and employee relations can now be transformed from liabilities into investments that improve a company’s overall position.
Columbia Steel has been on this path for a while now, and we’re excited that the simple act of treating the environment and employees with respect and consideration is finally being recognized for what it is: a potent investment in your company’s success. We believe that’s what’s helped us find success for 120 years and what will propel us to more success in the years to come.