ESG as a valuable business choice
ESG serves as a drive towards a positive and sustainable change and building a more resilient future. It ensures sustainable growth, by promoting awareness on environmental protection, reduced CO2 footprint, solid governance, professional integrity, ethical business, well being of people and social actions.
Environmental, Social and Governance (ESG) factors are growing in companies’ agendas, as their integration into management and investment decisions is becoming a mandatory business choice.
ESG Strategy and Objectives approach
Strategy and objectives are based on the Industry, Location, Size and Activities. Company’s Mission and Vision, along with Management Public Commitments to global Sustainability Targets are very important public disclosures, that add value to the company’s profile.
It is imperative that the Strategy and Objectives are customized on each company’s size, activities, location and business model, based on an extensive Materiality Analysis, actively involving internal and external stakeholders. Setting goals that are relevant, achievable and value-creating, is the key to sustainable development, eliminating the risk of setting unrealistic targets, that could generate excessive costs and potential liabilities. Identification and monitoring of core KPIs, is essential to create a clear-cut, distinct character, that is resilient and sustainable and reflect the company’s values and vision.
ESG Reporting & ESG Rating
The ESG reporting and/or rating, represents an important opportunity to put each company in a position of leadership, in the path to sustainable development and inclusive growth. The benefits for the company are significant, placing the company in a favorable position ahead of large environmental, societal and governance megatrends, such as climate change and the transition to a low carbon economy, the impact of technology on jobs and human capital, and improving inclusion in the workforce and in business practices. Sustainability reporting is linked to Non-Financial Reporting, which is mandatory for a large range of companies. The ESG Rating is designed to measure a company’s resilience to long-term, sector material environmental, social and governance (ESG) risks and opportunities. It is a measure of the exposure to ESG risks and how well they manage those risks relative to peers. Furthermore, the value of ESG and Sustainability reporting expands way beyond compliance, as it allows Planning of a resilient business model and Accurate decision-making.
Benefits of an ESG reporting/ rating
ESG report and successful ESG ratings, ensures compliance to applicable regulation, meeting clients’ expectations, identifying and addressing emerging market trends. An ESG report makes a statement to the market about the ESG commitments and is Increasingly used by investors and financial institutes. It provides better understanding of a company’s performance on material ESG factors and assists in managing the exposure to ESG risks