The ESG (environmental, social, and governance) reporting process is one of the most important aspects of your business. It can help you identify potential issues with your operations and improve your efficiency while protecting the environment. However, many businesses struggle with understanding how to incorporate technology into their reporting process so they don’t waste time or money on solutions that don’t work well for them. In this post we’ll go over some tips that can help make integrating technology into your ESG reporting easier.
What is ESG Reporting?
ESG reporting is a process that helps companies understand, manage and improve the sustainability of their business. ESG reporting is a way to measure how well a company is doing in terms of its environmental, social, and governance (ESG) performance.
Let’s take an example: let’s say you are an apparel retailer with two stores in Australia and one store in China. You want to know how much your ESG reports affect the profitability of your business because some customers may choose not to shop there if they know about illegal labor practices or poor safety standards in countries where you operate stores.
Why is ESG reporting important?
Before you can understand what this means for your company, it’s crucial that you first understand why ESG reporting is so important:
It helps companies understand their impact on the environment and take action to improve it. By collecting and sharing this kind of information about how they’re doing things in terms of sustainability metrics, investors can see how well or poorly they’re performing against industry standards; likewise, employees will be able to make informed decisions about where they want their careers going with regard to working at these organizations knowing what kind of measures are being taken internally when making hiring decisions, promotions, etc.
1. It’s important to understand that the ESG reporting process is not a one-time event.
It’s important to understand that the ESG reporting process is not a one-time event. The beginning of your ESG reporting process should focus on establishing your baseline and creating a baseline for future years.
Your first step should be identifying which data sources will be used in your ESG reports, including internal databases, third-party information sources like public databases or open-source data sets, and publicly available reports from organizations such as the World Resources Institute (WRI) or The Climate Group (TGC). Once you’ve identified these sources of information it’s time to begin building relationships with them so that they can provide access needed for their data sets.
2. ESG reporting needs to be an ongoing process.
ESG reporting is an ongoing process. It’s not a one-off activity, nor is it something that can be completed in a week or two. Rather, ESG reporting should be seen as part of your company’s overall strategy and planning process—and it will have to continue for at least three years after the initial commitment has been made.
If you’re starting out with ESG data reporting as part of your strategy, this means you’ll have to commit yourself to spending time on this task every year until your goals are met. This can mean investing more time than usual into creating report templates and conducting interviews with relevant stakeholders so they understand what they need from the report before they receive it (which could take up even more time).
3. The beginning of your ESG reporting process should focus on establishing your baseline and creating a baseline for future years.
Once you’ve done this, the next step is to start tracking and reviewing your progress.
This may sound like a lot of work, but it’s actually quite simple if you know what to look for.
Establishing a baseline will help you understand where you are today in terms of ESG data reporting so that when new policies come into place or new projects start up, there’s already an understanding of how much effort needs to go into tracking those changes over time. Setting up baselines for future years will help ensure that any changes made during one year aren’t lost forever due to neglecting them later on down the road—so if something happens like an employee leaving or some other change occurs within their department then it won’t be as easy for them (or anyone else) get back up-to-speed quickly without having enough information available beforehand
4. Once you’ve established your baseline, you can then begin to track and review your progress.
This will help ensure that the company is on track with its goals. You can use software designed specifically for ESG reporting. This is the most common method used by companies who want an easy way to track their progress toward achieving their targets and objectives. Software provides reporting functionality as well as other resources such as training videos and white papers on how best practices should be followed when it comes to reporting emissions data; they also offer templates so that users don’t have too much work identifying what needs focusing on first before getting started with any actual reports generated through this type of toolset!
5. You will want to set up reporting on a company-wide basis as well as at a local level. This means collecting data at the regional level, state level, and country level.
You may be wondering what this has to do with ESG investing and sustainability reporting. Well, your company has different groups of people who need to report their data differently. For example, if you are an oil producer in Texas or Oklahoma you will want your production teams in those regions to report their environmental performance data so that they can be compared against each other within their own states and countries.
6. When integrating technology into your ESG reporting process, you can engage with stakeholders more effectively and ensure accurate reporting throughout the year.
- Technology will help you track and review your progress.
- Technology can create a baseline for future reporting and help identify gaps in data collection or reporting requirements.
- It’s harder to get buy-in on traditional methods of communication (like spreadsheets) than it is to use digital tools that allow for easy sharing of information among team members across multiple departments or locations within your company (e.g., one person could be responsible for creating an executive summary while another creates the full report).
Conclusion
As you can see, there are many ways to integrate technology into your ESG reporting process. You may want to start with simple methods like creating an online portal or mobile app that will help you manage your data collection. If this isn’t enough for your needs, then consider using a cloud-based software platform like Gainfront. These platforms allow companies to connect their existing systems into one comprehensive dashboard that offers complete visibility into how they measure their sustainability performance through all levels of their business ecosystem including supply chain, operations, human resource management, and more!
Rahul Asthana has a PhD in Operations Management from the Anderson School at UCLA. He has 25 years of experience in supply chain management, starting his career in IBM working in supply chain operations. He then moved into product management and product marketing of supply chain software while at SAP and Oracle. He manages product strategy and product management at Gainfront. In terms of hobbies outside of work, he really enjoys tennis. Follow Rahul Asthana on Linkedin!
