How Do I Describe My Company's Governance Targets in an ESG Report?

We don't set formal targets" — you may already have the basics

When SMEs reach the governance targets section of their ESG report, it is easy to assume this only applies to large organisations with compliance departments and dashboards. In reality, a governance target is simply a measurable statement of where you want your company's governance practices to improve. Most companies, even small ones, already have some sense of this, even if it has never been written down formally.

If you already think "we should make sure everyone completes some basic compliance training each year" or "we should check in on our key suppliers occasionally," you are most of the way to a real target. The task here is to make that intention specific and measurable.

‍

What is this question actually asking?

This section wants you to describe measurable governance targets, generally covering:

• Leadership diversity
• Compliance training
• Policy reviews
• Ethics and compliance performance
• Supplier due diligence
• Transparency reporting

For each target, a strong answer includes a specific metric, a timeframe, and who is accountable for it. You do not need a target in every category—only where it is genuinely relevant to your company's size and structure. A five-person business, for example, may have very little to say about supplier due diligence at scale, but might still have a meaningful compliance training target.

‍

Good governance targets are measurable

The most important principle here is the same one that applies to climate targets: a target needs to say what will improve, by how much, by when, and how you will know if you have succeeded.

Compare these two statements:

• Vague (not a target): "We want our leadership team to be more diverse."
• Measurable (a real target): "Achieve gender representation of 40-60% in senior leadership roles by 2028."

The second version gives a reader, and your own team, a clear way to check progress later. Wherever possible, include percentages, completion rates, deadlines, and a clear owner for tracking progress.

‍

Common governance target areas

Leadership diversity and representation

This might include gender balance in senior leadership or partnership roles, or broader diversity goals across leadership positions. For a small company, a realistic version might be more modest than a large corporate target—for example, aiming for a specific gender balance on your leadership team by a given year, keeping the actual number of people involved in mind rather than borrowing a percentage range designed for a much larger organisation.

Compliance training and awareness

A common and very achievable target for SMEs is ensuring all employees complete basic training on things like code of conduct, anti-corruption, data protection, and whistleblowing procedures annually. If certain roles need specialised training—for example, anti-money laundering training for client-facing staff—this can be a separate, specific target.

Policy review and currency

This covers how often your governance policies themselves get reviewed and updated. Even a simple commitment like "review all governance policies annually and update as needed" is a legitimate target, as long as it is actually followed.

Ethics and compliance performance

This might include targets around reducing policy breaches, or ensuring reported concerns are investigated within a set timeframe (for example, "address all whistleblowing reports within 30 days"). For smaller companies, this can be scaled down significantly—the principle of a clear response timeframe matters more than the specific number.

Supplier ethics and due diligence

This covers whether you assess suppliers or business partners for ethical and compliance risks. A realistic SME target might be something like "conduct basic due diligence checks on all new significant suppliers," rather than a target designed for a company managing hundreds of supplier relationships.

Governance transparency

This covers how openly you report on your own governance performance—for example, committing to publish your ESG report annually and disclose progress against the targets you have set.

‍

Structure and accountability matter

For each target, it helps to briefly note:

1. The specific metric or goal
2. The timeframe (short-term, medium-term, or long-term)
3. Who is accountable for tracking and achieving it

You do not need a dedicated compliance officer or quarterly dashboards to have credible accountability. For a small company, something as simple as "the founder reviews progress against these targets annually" is a legitimate and honest accountability structure. What matters is that someone is genuinely responsible, not that the process looks like a large enterprise's compliance function.

It can also help to group targets by time horizon:

• Short-term: Things achievable within a year, like training completion.
• Medium-term: Things requiring more structural change, like reducing policy breaches.
• Long-term: Bigger ambitions, like sustained leadership diversity goals.

Not every company needs targets across all three horizons in every category—pick what is realistic for where your business is today.

‍

Keep targets realistic and proportionate

It is tempting to borrow ambitious-sounding targets from a large company's ESG report, but a target copied from an organisation many times your size often does not fit your actual operations, and can be hard to credibly track or achieve. A modest target that your company actually meets—and can demonstrate progress on next year—is far more valuable than an impressive-sounding one that gets quietly dropped.

If your company is very small, it is entirely reasonable to scale these targets down significantly, or to note that a particular category (like extensive supplier due diligence) is not yet proportionate to your current size, while still describing what you do commit to.

‍

Common mistakes to avoid

• Writing vague ambitions instead of measurable targets: "Improve compliance" is not a target; "ensure 100% of employees complete annual compliance training" is.
• Copying large-company targets wholesale: A target designed for an organisation with hundreds of suppliers or a dedicated compliance team often does not fit an SME's actual operations.
• Forgetting timeframes: A target without a deadline is hard to track and easy to forget.
• Forgetting accountability: A target with no named owner, even an informal one, looks unmanaged.
• Setting targets you have no intention of tracking: If you cannot realistically monitor progress, the target is not useful—better to set a smaller, trackable one.

‍

How Wardn helps

Wardn provides a structured template with example wording covering each governance target area, so you can adapt it to reflect your own company's realistic ambitions rather than starting from a blank page. The same structure can be reused and updated year after year, making it straightforward to track progress against previous targets and adjust them as your governance practices develop.

‍

Frequently asked questions

Do we need targets in all six governance categories?

No. Only include targets for areas genuinely relevant to your company's size and structure. A small business might have meaningful targets for compliance training and policy reviews, but very little to say about large-scale supplier due diligence.

What makes a governance target measurable rather than just an ambition?

A measurable target states what will improve, by how much or to what completion rate, by when, and who is responsible for tracking it. "Improve compliance" is an ambition; "100% of employees complete annual compliance training by year-end" is a target.

Do we need a compliance officer or dashboard to track these targets?

No. For a small company, it is entirely reasonable for a founder or manager to informally review progress against these targets once a year. What matters is that someone is genuinely accountable, not the formality of the tracking process.

Should we set ambitious diversity or supplier due diligence targets even if they don't fit our size?

No. Scale targets to match your company's actual size and operations. A modest, achievable target that you can track and report on honestly is more valuable than an ambitious one copied from a much larger organisation.

What's the most common mistake companies make with governance targets?

Writing vague statements without specific metrics, timeframes, or accountability. A short, measurable target with a clear owner is far stronger than a general commitment to "better governance."

‍