In today’s changing world, organisations are increasingly acknowledging the importance of integrating Environmental, Social, and Governance (ESG) principles into their operation plans. ESG technologies facilitate this integration by enabling measurement, management, and improvement of ESG performance. This blog post provides an introduction to ESG technologies and discusses how they can benefit public and private organisations.
What data are ESG Technologies considering?
Before we delve into the exciting world of ESG Technologies, let us start with an introduction to the types of data these are dealing with.
Environmental data can include measurements of carbon emissions, energy consumption, water usage or waste management
Social data monitors factors such as diversity and inclusion, employee well-being and labour practices.
Governance data looks at board composition, risk management and ethics, just to name a few.
What are ESG Technologies?
The market of ESG tools is booming and the tooling landscape is changing rapidly. Many of these tools and technologies help organisations collect, track and report on ESG data, each in their own way and with their own specific scope.
We see five main categories of ESG tools:
1.
ESG reporting tools
Reporting platforms designed specifically to support sustainability reporting.
2.
Existing financial reporting tools
Several existing platforms recently evolved with a set of additional modules enabling tracking and reporting on ESG data.
3.
GHG (Greenhouse gas) management systems
Also known as carbon accounting tools. These technologies are used to measure, track and manage an organisation’s greenhouse gas emissions with a view to mitigating environmental impact and complying with regulations.
4.
Value stream tools
Several existing ERP (Enterprise Resource Planning), CRM (Customer Relationship Management) and HR (Human Resources) platforms have developed ESG modules to track and manage specific sets of ESG data.
5.
Cloud platforms
Flexible cloud platforms offering out-of-box ESG functionalities, and/or allowing organisations to build their own bespoke solutions.
Why are ESG Technologies important?
ESG technologies can help you:
1.
Keep up with advancing regulatory requirements.
With growing regulatory requirements related to sustainability and corporate governance, ESG reporting technologies help ensure compliance through ESG data transparency and, ultimately, automated data collection and reporting processes.
2.
Manage complex sustainability information more effectively and bring trust in the data.
If anything, ESG data requirements from stakeholders and regulators will only grow in complexity. ESG tools will become a must-have to easily organise and make sense of all the different sustainability data points, while also delivering auditable reports.
3.
Make better, faster decisions and unlock rising net value for business.
The best insights and strategic decisions are driven by real-time, integrated data. ESG tools that integrate sustainability metrics with financial data, will empower organisations to drive both ESG and better economic performance.
4.
Improve efficiencies and free up resources to focus on value-added tasks.
Automated data collection and report generation, in addition to streamlined processes, reduces the burden placed on teams and allows them to focus on higher-value activities that drive business growth (in a sustainable manner).
Authors
ESG and Technology
Integrating technology to meet ESG ambitions
ESG, sustainability and climate
Transforming business for a better world
