ESG data collection can be complex. This is due to the broad scope of the subject matter and a fragmented reporting landscape based on multiple frameworks.
Moreover, ESG metrics and disclosure requirements are constantly evolving. This is why you need a flexible solution that can scale with your operations and shifting priorities.
What are the benefits to ESG data?
ESG data provides valuable insights into a company’s sustainability and environmental impact. It can help to mitigate risks, improve business performance, create opportunities and increase investor interest. It also helps companies comply with regulations and international agreements.
In addition, ESG data can have a positive impact on a company’s reputation and brand. It can increase employee morale and loyalty, and ultimately – customer retention and growth. It can also reduce a company’s operational costs by promoting environmentally friendly manufacturing techniques.
For these benefits to be realized, however, it’s crucial that companies collect and manage their ESG data accurately. Choosing the right data vendor is critical for success, as is creating a comprehensive and standardized ESG reporting solution. ICE ESG Reference Data, for example, offers raw data that provides detailed information on key ESG attributes and indicators in a standardized format. This makes it easy for investors to analyze and understand ESG issues, uncover opportunities and assess risk by visiting this link.
Join Our Small Business Community
Get the latest news, resources and tips to help you and your small business succeed.
What is ESG reporting?
ESG reporting is the process of systematically gathering, collecting, and disclosing information about environmental, social, and governance aspects of a company. This information can then be used by investors, analysts, and employees to make informed decisions about investing in or lending to a particular company.
The most effective ESG reporting programs focus on a few key data elements that are critical to the organization’s business. These may include metrics related to environmental impact (energy use, greenhouse gas emissions, etc.), labor practices, community engagement, and supplier diversity.
There are a number of vendors that provide ESG data, so it is important to select a vendor that covers issuers in an investor’s investable universe and can distill disparate data into easy-to-digest scoring or ratings. Additionally, it is critical to understand how often the data is updated – some vendors provide information on a daily basis, while others only update on a quarterly or annual basis. This can have a big impact on the accuracy and value of the data.
What are the three components of an ESG reporting?
ESG reporting is all about disclosing information covering a company’s operations in the areas of environmental stewardship, social responsibility, and governance. These data points are then used to establish a company’s sustainability or ESG score.
Investors and customers look for companies that are willing to be transparent about the impact of their activities on the environment and society. They want to know if their investments are supporting companies that align with their values and that care about their customers, employees, and the environment.
Implementing new ESG data processes can be complex and require the support of senior management. It’s best to start small and focus on accuracy and data quality before moving onto more complex analytics capabilities. This will help avoid a waterfall approach and prevent technical debt. It’s also important to identify and prioritize specific use cases and create clear stage gates to guide development. This will help ensure that you are leveraging the most relevant and accurate data for your ESG initiatives.
Steps to Success in Using Your ESG Data
Collecting ESG data is not a one-time effort – it’s an ongoing process that requires collaboration across multiple departments. For this reason, it’s important to set up repeatable workflows and monitor the effectiveness of these processes over time. It’s also helpful to be transparent about your goals and priorities, as well as the challenges you face.
The first step in collecting ESG data is establishing what your company wants to measure and report on. It’s important to focus on a small number of key ESG metrics, and avoid trying to capture everything that might be relevant.
Next, it’s crucial to select the right ESG data providers. This can be done by evaluating the coverage of various vendors against an investor’s investable universe, and also looking at the ability to distill disparate data into easily digestible scoring or ratings.
What about Greenly?
As Greenly scales, they’re developing new internal tools all the time: managing relationships with vendors, producing regular reports, analyzing niche datasets, scheduling equipment maintenance. These needs typically arise in one of two ways: a scrappy spreadsheet or a full React application that requires a significant investment of engineering hours to build.
Before finding Retool, these types of internal projects were handled with a custom tool that Greenly developed themselves or a third-party product. While these solutions did the job, they were brittle and slow to respond to new requirements. Retool allows the team to rapidly create new internal applications that meet these new needs in about half a day. They’ve improved their time-to-deployment KPI by 3x and consistently save 50+ engineering hours a month.
In addition to streamlining internal processes, Greenly uses Retool to quickly build applications for their customers. For example, they used Retool to create a quote generation tool for their sales teams that integrates with their CRM (HubSpot). This solution was built in less than a day and can be adjusted as needed by the sales team. It’s a big improvement over HubSpot’s existing quote generator and demonstrates the power of Retool to quickly respond to customer needs.
Carbon management is a complex industry, and Greenly’s goal is to make it simple and accessible to small- and medium-size enterprises. This is why they built an entire suite of applications to serve their customer base using Retool Embed. The Embed framework lets Greenly.earth keep their authentication flow and simply plug in new Retool apps to get the work done that would otherwise take months — if not quarters — from a fully staffed team of engineers.
The go-to carbon accounting platform for your business
The current generation of GHG emission management software tools and platforms provide robust, automated accounting and analysis for tracking company-wide greenhouse gas emissions and managing GHG inventory calculations. They enable businesses to track, analyze and report on their emissions related to activities like building energy use, solid waste to landfill, business travel and employee commuting as well as to identify opportunities for reducing their emissions through the application of carbon reduction strategies.
These systems can help companies manage their carbon footprints and meet regulatory climate disclosure requirements. They also support the transition to a more circular economy, which reduces waste and resource consumption by promoting reuse, repurposing, recyclability, and other measures that lower GHG emissions. Currently, existing reporting platforms such as CDP and EcoVadis are valuable tools for businesses, but they are geared toward annual reporting. As a result, any data released through these channels is out of date by the time it becomes available to the public.
When selecting a carbon accounting software solution, it’s important to consider a provider’s experience and knowledge of best practices in emissions reporting. Look for a solution that supports nationally-recognized carbon accounting methodologies and has an emission factor engine that allows for the inclusion of custom time-varying factors. It’s also a good idea to select a product that simplifies the auditing/verification process by enabling easy access to source documents for 3rd party auditors. This makes it easier to meet compliance requirements as they develop.