“You can’t manage what you can’t measure” is an old management adage that is still accurate today. With a clearly established metric for success, you can quantify progress and adjust your process to produce the desired outcome. The same rule applies to sustainability and ESG reporting. In this article, we will advice how to use analytical data to make best out of sustainability and Environmental Social Governance (ESG) reporting.
If you read our previous article (see here), you already know what general benefits of sustainability are. In order to achieve any of those, you will need to measure your company sustainability performance. Quantified data is a key to support and benefit from your ESG credentials.
First of all, let’s think about cost savings and ROI. Sustainability strategy should be a profit centre for the business, and in fact small and large companies alike who integrate ESG effectively always find positive outcomes and bottom line savings”. Some simple examples:
- If you reduce carbon, you save energy = PROFIT
- If you reduce number of sick days, your company is more efficient = PRODUCTIVITY
- Reduce waste and recycle more and limit landfill waste = PROFIT AND EFFICIENCY
- Improve training and knowledge in the company = LOYALTY AND LEADERSHIP
Turnkey Group can help you to measure your energy, water consumption, waste, material consumption, social impact and corporate effectiveness leading to carbon efficiency and cost savings.
Analytical tools allow you to track your historical trends, benchmark performance of different sites or companies and easily spot inefficiencies. Find out more here.
Another aspect is brand image and building competitive advantage. In order to make the best out of your sustainability strategy and generate new business flow, you need to fully engage your marketing team in the sustainability program. Your marketing team should talk confidently about your sustainability targets and achievements. To do that, they will need to back it up with proven results. Being accused of ‘green washing’ can be very costly for your reputation.
It is proven that ‘sustainable’ and meaningful brands outperform their competitors. The Natural Marketing Institute discovered that 58 percent of consumers consider a company’s impact on the environment in considering where to purchase goods and services. Encouragement and practice to conserve resources not only improves brand awareness, but also penetrates at a deeper level to employees, their families, and beyond. It will help you to attract new talented staff – reducing recruitment costs, supporting productivity and driving innovation. “When people are proud, they will share it – they will spread the word. Talent acquisition moves beyond bringing in great talent and into being a prime mover in a leading sustainable growth strategy” said Stephen Lockheed, Vice President, Global Talent and Resourcing, Unilever.
Measuring ESG impact is also becoming a critical factor for investors and trading partners. What investors are looking for in sustainability reports are “material” ESG risk factors with verified, quantified data points that highlight financial benefits. ESG data should be integrated into an economic assessment and valuation to improve investment analysis, decision-making and make it more relevant for companies and their investors. According to recent Blackrock Viewpoint, one of the main challenges investors struggle is inconsistent collection, management and limitations to comparability of ESG data.
Turnkey Group has been supporting private equity portfolio businesses by measuring and reporting their sustainability KPIs according to investment partners’ requirements. Investors want to see quantified ESG factors communicated in comparative and consistent manner. ESG is only relevant if it can be compared to a past performance, a competitor, best practice or new market development. This is where data analytic tools play a key role.
Also remember that to stand out in tenders and win a government or corporate projects, you will need to provide evidence against your company sustainability performance using verified data. As sustainability is being forced down to the supply chain by the bigger brands, suppliers are important partners that help bigger brands improve the efficiency of the processes and the sustainability profile of the products they sell. Thus, big retailers and brands now insist on their supply chain partners having a sustainability policy in place. It is an opportunity for SMEs to implement a sustainability strategy, quantify its impact, and differentiate themselves from the competition to win business. As a result of measuring and reporting your environmental and social impact, you will be seen as a ‘lower risk’ supplier.
Let’s not forget about government and multiple stock exchange legislation on ESG reporting for listed companies. We see increased number of compliance around environmental and social standards that demands verification through reliable data.
Lastly but not leastly, it is important to highlight that using data management platforms and analytical tools will not only give your company more insights and make data more accurate and reliable, but also will help to save time and minimize workload by automating ESG data collection process.
To summarise: to achieve best results out of your sustainability strategy – measure your ESG impact, use analytical tools to identify inefficiencies and optimise your operations, set your targets and prove it with verified results that you can share with your customers and target audience. It will help you to retain and win more business.
Turnkey Group provides a sustainability platform that makes it easy to collect, measure and report on sustainability data, so you have sustainability metrics that you can use for ESG reporting and communication with your customers and investors. With our solutions, you can measure and report on your ESG impact more effectively, identify systemic ESG risks in your company, supply chain or investment portfolio and make the most out of your sustainability credentials. Find out more here.
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