G4-EC8


Significant indirect economic impacts, including the extent of impacts

  • Report examples of the significant identified positive and negative indirect economic impacts the organization has. These may include:

    • Changing the productivity of organizations, sectors, or the whole economy
    • Economic development in areas of high poverty
    • Economic impact of improving or deteriorating social or environmental conditions
    • Availability of products and services for those on low incomes
    • Enhancing skills and knowledge amongst a professional community or in a geographical region
    • Jobs supported in the supply chain or distribution chain
    • Stimulating, enabling, or limiting foreign direct investment
    • Economic impact of change in location of operations or activities
    • Economic impact of the use of products and services
  • Report the significance of the impacts in the context of external benchmarks and stakeholder priorities, such as national and international standards, protocols, and policy agendas.



​Indirect economic impacts are an important part of an organization’s economic influence in the context of sustainable development. Whereas direct economic impacts and market influence tend to focus on the immediate consequences of monetary flows to stakeholders, indirect economic impacts include the additional impacts generated as money circulates through the economy.

Direct economic impacts are often measured as the value of transactions between the organization and its stakeholders, while indirect economic impacts are the results – sometimes non-monetary – of the transaction. Indirect impacts are an important aspect of an organization’s role as a participant or agent in socio-economic change, particularly in developing economies. Indirect impacts are particularly important to assess and report in relation to local communities and regional economies.

For management purposes, indirect economic impacts are an important indication of where risks to reputation may develop, or where opportunities may emerge to expand market access or a social license to operate.

​Identify examples of significant indirect economic impacts, both positive and negative. These may include:

  • Changing the productivity of organizations, sectors, or the whole economy (such as through greater adoption or distribution of information technology)
  • Economic development in areas of high poverty (such as total number of dependents supported through income from one job)
  • Economic impact of improving or deteriorating social or environmental conditions (such as changing job market in an area converted from small family farms to large plantations or the economic impacts of pollution)
  • Availability of products and services for those on low incomes (such as preferential pricing of  pharmaceuticals contributes to a healthier population that can participate more fully in the economy; pricing structures that exceed the economic capacity of those on low incomes)
  • Enhancing skills and knowledge amongst a professional community or in a geographical region (such as need for a supplier base creates a magnet for organizations with skilled workers, which in turn engenders new learning institutes)
  • Jobs supported in the supply chain or distribution chain (such as assessing the impacts of growth or contraction of the organization on its suppliers)
  • Stimulating, enabling, or limiting foreign direct investment (such as expansion or closure of an infra-structure service in a developing country can lead to increased or reduced foreign direct investment)
  • Economic impact of change in location of operations or activities (such as outsourcing of jobs to an overseas location)
  • Economic impact of the use of products and services (such as linkage between economic growth patterns and use of particular products and services)

​None.

​None.