We’ve spoken a lot about ESG over the past few weeks. First, we broke down what ESG actually means, as well as why it’s an important consideration for all businesses to make. Next, we covered some of the key ESG challenges faced by financial providers, before looking at 7 simple ways to take your ESG reporting from good to great.
Whether it’s to please your investors, bolster your reputation, or appeal to the more socially engaged consumer, it’s no secret that factoring ESG-related issues into wider business plans and strategies is good for business.
Many companies are starting to go above and beyond mandatory ESG reporting. Instead, they’re voluntarily adopting frameworks and processes to mature their ESG strategy. And in doing so, they’re preparing themselves for the inevitable future in which more advanced legislation will be introduced regarding ESG disclosures.
We thought we’d break down what environmental, social, and governance initiatives might actually look like in practice. This should give you some ideas on how you can evolve your ESG approach over the coming years.
Focus on what’s materially important
First of all, we should say that ESG initiatives and reporting will look slightly different to every organisation. Each has their own interests, passions, values, and resources.
It’s crucial for every business to identify and prioritise what’s most important and relevant to them before developing an ESG strategy. This way, you can ensure all your time and resources are being spent wisely. And that the final results of your efforts align with the expectations and interests of your stakeholders and customers.
As you can likely imagine, this pillar of ESG is how your business operation impacts the environment, both positively and negatively.
How might this present in your organisation?
- You may monitor the energy efficiency of your offices or sites. You’d capture this data on an ongoing basis to demonstrate a commitment to boosting your efficiency long-term.
- It might be a priority to reduce greenhouse gas emissions wherever possible. Key to this would be tracking this consistently alongside the government’s net-zero targets.
- How is your organisation affecting the local nature? Part of this would be noting what effects your sites and operations are having on the ecosystem and working to counter this.
- You could track the year-on-year development and change of land use and biodiversity.
- Developing circular economy principles would allow you to reduce and better manage organisational waste.
- For certain projects, you might look to raw material sourcing. So, as an example, you would look at how you use organic ingredients and Fairtrade suppliers.
- Ultimately, you can capture data relating to all of the above from any partners or suppliers to give greater transparency regarding your impact.
When it comes to the ‘environmental’ aspect, it’s all about acknowledging how your operations affect the world around you and how you can mitigate any changes. It goes beyond CO2 emissions and energy usage into every aspect of your work.
This is all about how your organisation impacts people, whether that’s your staff, customers, or wider community.
Examples might include:
- Developing meaningful relationships within your local community. This could mean providing education and internship opportunities to local people. Also, regularly consulting with the community about how you can better support it long-term.
- Demonstrating an ongoing commitment to diversity and inclusion, both within your own organisation and any other suppliers you may deal with.
- Evidencing ethical labour standards across your entire supply chain.
- Providing safe and healthy working conditions for your staff. This might involve providing better support and education surrounding mental health, offering flexible working arrangements, and upholding government guidelines surrounding COVID.
- Making efforts to improve employee engagement. You would look to create a work environment where people want to spend their time. This could also potentially include any benefits or perks your staff receive as part of their employment.
- Making sure your company’s mission is socially relevant and provides tangible benefits to wider society.
- Providing evidence of how your business gives back to others, whether that’s volunteering, charitable donations, or anything else.
For this, you want to look at how your operations affect all people. Are your staff fulfilled and healthy? Is the local community considered and included? And how do you have a positive impact on people across the globe?
And finally we have governance, which is all about how your organisation is managed ethically and appropriately.
This might mean:
- Going above and beyond to protect the interests of your shareholders.
- Full and honest financial reporting.
- Ensuring a diverse and inclusive group of people make up your board.
- Eradicating any and all bribery and corruption within your organisation, and making sure similar values are demonstrated by anyone else you work with or alongside.
- Getting crystal clear on your business’s ethics and ensuring these are reflected in every aspect of your operations, across all levels.
Expectations surrounding ESG-related issues are only getting bigger, with investors, consumers, and wider society becoming increasingly conscious of a business’s great potential for positive change, as well as environmental and social harm. It’s why so many businesses are now looking beyond compliance, deeply embedding ESG reporting into their daily operations.
With Impact, you can seamlessly integrate ESG considerations into your daily operations. With intelligent data capture, analysis, and reporting, it’s simple to monitor your initiatives and track progress over time. To find out more about what our platform could do for you, schedule a demo or get in touch with the team on 0161 532 4752.