ESG reporting is a way for companies to disclose the non-financial metrics that impact their business and environment. The acronym ESG stands for environmental, social, and governance.
The number of asset owners adopting ESG metrics has increased over the last year. Companies need to streamline their ESG reporting processes to improve accuracy and efficiency. Here are the top 5 ways to go about it.
Automated data imports and exports can save your organization time and money by reducing the manual processes involved in getting ESG data. You can import information from third parties, such as your sustainability consultants or social media users who post content about your company.
You can also export data to them, such as reports on internal sustainability efforts or summaries of community engagement events. And with bulk imports/exports, you can easily move hundreds or even thousands of files at a time—saving hours’ worth of work compared to doing so manually!
FigBytes is one of the best automation platform options available today if you’re looking for ways to streamline your ESG reporting processes. It’s a cloud-based platform that captures sustainability data from all parts of an organization, existing systems, and external sources.
Then, it puts it all together so that organizations can connect their strategies and automate reporting for sustainability through real-time communication with stakeholders.
Consolidate ESG reports
Consolidated reporting is a collection of disclosures from multiple sources, such as financial statements and other regulatory filings, reported in a single document. This streamlined format makes it easier to see how your company’s ESG performance compares to others in your industry.
Consolidating your ESG metrics into one report helps eliminate redundant data gathering, simplifies compliance requirements, and reduces the time spent compiling information on sustainability metrics. Data collected through consolidated reporting can be shared across all business units or used for benchmarking purposes within an organization.
All information in your consolidated ESG report should come directly from reliable sources such as public databases or third-party reports. If any information isn’t verifiable through these sources, then disclose this so investors know exactly how much confidence they should have in the report.
Use a third-party provider
ESG reporting can be a daunting task. It’s easy to get lost while keeping up with all the rules and regulations, especially if you’re doing it independently. So you need a good third-party provider to help you stay on track, meet deadlines and avoid mistakes so that your investors can see how well your company is performing in this area.
There are plenty of third-party providers out there who can help you optimize your ESG reporting processes through software or services.
These providers offer tools that make it easy to track multiple metrics with one platform and achieve compliance with all legal requirements relating to ESG issues. They can help you meet your reporting obligations if you don’t have the resources or time available within your company to do so yourself.
Their teams typically comprise subject matter experts (SMEs) that can help you understand the information you’re collecting and how to interpret data. As a result, you will be better equipped to interpret the information coming from third-party providers when creating an overall picture of your company’s social impact on the environment and society.
Use data visualization tools
The data available on ESG reporting can be overwhelming, but there are ways to make it more accessible for everyone involved in the process. One way is by using data visualization tools like dashboards and graphs, which allow users to get a quick snapshot of their progress over time.
Data visualizations are an effective way of helping stakeholders understand the data and its implications. You can use the graphs, charts, and other visuals you create in reports, presentations, and discussions with management regarding ESG issues across your organization.
The tools help you identify data sources. The type of software you use will depend on your organization’s specific needs, but if there is one thing they all have in common, they’re easy to use.
You can improve processes with a few of the following features and tips.
Create interactive charts that allow users to filter out certain factors or adjust them based on their preferences.
For example, if you were creating an interactive chart showing how much carbon dioxide emissions each department has saved since 2012, users could filter by department, product type, and location. They could see which departments are doing well at reducing emissions and which ones need more improvements.
Use heat maps to compare different aspects of your company’s ESG performance over time. For example, if you wanted to compare how much carbon dioxide each plant has produced since 2022, you could create a heat map showing how much each country reduced its carbon dioxide emissions over time.
Use graphs to show trends over time. For example, if you wanted to show how much paper waste your company produced last year compared with this year, you could create a graph showing those figures over time.
You could also add other elements like cost per ton of paper waste produced or total cost savings from recycling initiatives to give readers more context about the figures shown in the graph.
Appoint a single point of contact for ESG reporting
The final step is to appoint a single point of contact for ESG reporting. This person should be able to answer questions, help with data collection and management (such as organizing data into reports), and assist with data visualization.
The role of this individual may vary depending on your organization’s size and structure. However, they will need to be familiar with both qualitative and quantitative aspects of ESG reporting so that all stakeholders can easily access information about social responsibility practices.
A good way to determine who this individual should be is by looking at your current organizational structure. If you already have someone in place with experience with sustainability initiatives or governance, then that person may be best suited for overseeing ESG efforts.
ESG reporting is vital for all types of businesses. The reports must address the ever-changing needs of regulators and gain the positive of investors. You can streamline ESG reporting by using advanced technologies and implementing innovative practices.