With global concerns about cyber security, climate change, social justice, supply chain issues, and the impact of the Covid-19 pandemic, there is a growing importance being placed on business practice that adopts an ESG approach. Environmental, social and governance (ESG) is a framework that businesses can adopt that aims to enhance business sustainability across a range of factors. It isn’t a new thing, but it has gathered pace in the last few years, as more businesses look to go green, to be a place of work for others to aspire to, and where processes are as efficient as possible. There are a few ways to implement an ESG strategy, with ESG reporting software used to accurately track how a company is performing and where things can be tweaked for improvement in the future.
Understanding ESG metrics and implementing tactics
To implement a coherent ESG strategy it is important to understand the areas in which it can be impacted. There are a few different areas you can, and should, think of as a business owner and where your ESG reporting software can be used effectively.
Reducing your carbon footprint
This is probably the biggest ESG metric that businesses wish to track these days, with the global importance of climate change something that we are all beginning to experience on a regular basis. Reducing your carbon footprint as a business has become very important, as it is an area where climate change can be slowed down, and the environment preserved. Ways in which you can reduce your carbon footprint include switching to an energy provider that uses renewable energy, reducing business travel by adopting incentives for using public transport and offering a flexible, hybrid working format, and recycling, re-using, and reducing the use of physical company materials.
Energy efficiency
It might seem that energy efficiency is a complicated metric, but it doesn’t have to be when you have the correct ESG reporting software and approach. To become more energy efficient your company needs to complete the same set of tasks but with lower energy use. There are a few ways you can do this, such as encouraging staff to make the most of natural sunlight during their breaks to improve mood and morale, unplugging electrical equipment when not in use, installing energy-saving lightbulbs, and monitoring office temperatures. This will cut down energy use and help you become more efficient.
Health and safety
The health and safety of employees is another significant metric to measure. Strict, easy-to-understand health and safety measures help to keep staff happy and safe, which is a critical factor in thriving as a business over time. Have a clear health and safety plan, with regular monitoring to lower rates of workplace accidents and injuries, improved productivity rates, and lower staff turnover.
Product safety
Product safety is an ESG metric that is important for gaining the confidence of customers and investors. Product recalls, fines, and court action through faulty products will have a massively negative impact on brand reputation, so by demonstrating you have high levels of product safety, and mechanisms to deal with faulty products quickly and effectively, you can improve the metrics.
Diversity and inclusion
A diverse board of directors is something that is desirable from the viewpoint of investors and the consumer market, as it displays that there is genuine care taken for a broad range of viewpoints being taken seriously. This is then translated into the diversity and inclusion of the company as a whole, with inclusion programmes implemented for education and apprenticeship, promoting multi-lingual work, and an ethnic and culturally diverse workforce.
Integrating ESG into Business Strategy
Integrating an effective ESG strategy is important to a business, and it must involve an approach that covers all areas of the organisation. The success and potential growth of a business is tied to how effective its implementation of ESG is, providing genuine long-lasting value. A good integration of an ESG strategy includes a wide range of sustainability factors, it also focuses on those initiatives that matter most to that specific company, brand, and sector, looking to gain customer loyalty and investor confidence as a result.
Reporting ESG performance
The only way to be certain that your ESG strategy has been successful is to install the latest ESG reporting software from specialists in the field. Effective reporting software helps you to keep track of all the metrics you are focusing on, allowing you to see in real-time where your approach is paying off and where you could improve in future. The benefits of using ESG performance and reporting software are many:
- Gives a company a competitive advantage
- Attracts fresh investment and helps with borrowing potential
- Improves financial performance of the business
- Builds a loyal customer base
- Helps to create a solid foundation for sustainable operations
Implementing key ESG strategies alongside effective ESG reporting software will help a business to become more sustainable, ethically sound, and a good place to work for current and prospective employees. Finding the right provider of software helps to improve the entire process.
