Social Audits

Key takeaways

• A social audit is a formal review of a company’s policies, practices, and conduct related to social responsibility and its impact on society.
• It assesses whether a company is meeting measurable goals and benchmarks for social performance.
• Social audits are flexible and voluntary; results can be used internally or shared publicly to improve accountability and reputation.

What is a social audit?

A social audit evaluates how a business affects stakeholders—employees, communities, customers, and the environment—and whether the company’s actions align with its stated social responsibility objectives. Unlike financial audits, social audits focus on social, environmental, and ethical performance and how those outcomes shape public perception and long-term risk.

Purpose and benefits

• Measures progress against social responsibility goals and benchmarks.
• Identifies strengths and weaknesses in policies and operations.
• Supports transparency and accountability when findings are published.
• Helps manage reputational risk and can improve public relations.
• Guides strategy for community engagement, diversity, sustainability, and employee welfare.

Typical items examined

The scope varies by organization, but common topics include:
* Environmental impact and energy use (carbon footprint, renewable energy).
Transparency in reporting environmental or social issues.
Community development, charitable contributions, and volunteer programs.
Workplace conditions: safety, harassment prevention, equal opportunity.
Worker pay, benefits, and nondiscriminatory practices.
Diversity and inclusion initiatives.
Accounting and financial transparency relating to social programs.

Social audits can be narrow (focusing on a town or specific operation) or broad (regional, national, or global), depending on company goals.

Example

Many large companies publish annual reports that function as social audits. For example, a major cloud software company has publicly committed to powering its data centers with 100% renewable energy and publishes a Stakeholder Impact Report documenting progress toward that goal. Such reports illustrate how companies can use social audits to track measurable sustainability targets.

How findings are used

• Positive results may be disclosed publicly to demonstrate accountability and strengthen reputation.
• Negative or mixed findings can be retained for internal review to design corrective initiatives with measurable goals.
• Follow-up audits measure the effectiveness of changes and drive continuous improvement.
• Organizations may use findings to set timelines, allocate resources, and engage stakeholders in remediation or enhancement efforts.

Conclusion

Social audits are voluntary, adaptable tools that help companies balance profitability with social and environmental responsibility. When implemented thoughtfully and iteratively, they improve transparency, inform strategy, and can strengthen public trust while reducing social and reputational risks.