Are you eager to learn about different ESG practices and extend your contribution towards making a better environment? Then you have certainly come to the right place!
In this blog, we will delve into numerous ESG strategies which will surely turn your business into a sustainable one. We will also understand through case studies how other businesses have implemented these practices into their organisation.
By the end of this blog, you will be fully equipped with the knowledge of ESG and ways through which our organisation can benefit from it.
In today’s evolving business environment, ESG has become an important pillar of any organisation. ESG is a framework that is used to critically evaluate a company’s Environmental, Social and Governance factors that impact the company’s performance.
In recent times, stakeholders along with financial capabilities, also tend to take a company’s ESG practices into account.
ESG reporting includes disclosures of risks and approaches in tackling material ESG issues of water use, climate change, diversity and inclusion, cybersecurity and many such key areas.
It includes factors such as carbon emission, waste production and management, and renewable and non-renewable energy resources. Given the drastic change in the environment and depletion of natural resources, numerous companies are gradually shifting from non-renewable to renewable such as solar, wind and geothermal. Businesses that show a willingness to make these changes demonstrate their contribution to making a change for the planet.
Along with the responsibility towards the shareholders, companies hold responsibility towards society. Ethical and fair practices, inclusivity & diversity and philanthropic activities are essential for a business to perform. This, in turn, helps to build trust among the shareholders and in developing the social environment. This also includes ethical sourcing material, understanding and addressing the grievances of its workers and supporting small and local businesses.
Also known as corporate governance, refers to the rules and regulations laid down by the company and the government that ensure accountability and transparency in the ESG framework. It increases the responsibility of the stakeholder in making informed decisions about the activities of the business. Proper rules and regulations laid down assist in compliance with ethical and fair practices.
Climate change is not a threat to the future anymore, it is what is currently happening in the present. While you are reading this blog, somewhere around the world tonnes of coal are being burned, landfills are being overfilled, chemical waste exposed what remains untreated, etc.
Saving the planet is a collective activity for which ESG activities become useful. ESG assessments promote transparency and accountability of businesses towards environmental issues and the ways they adopt to combat them. This allows the stakeholders to build a good relationship with their business and make a decision on matters concerning sustainability.
Investors prefer investing in businesses that are conscious about their surroundings and actively make an effort towards making it come to reality. ESG compliance and regular, timely reports build trust in your stakeholders towards your company. The investor begins to develop confidence in your business.
Sustainability reporting gives stakeholders greater confidence in the organisation.
It assists in generating goodwill also in the business sphere which leads to more customers drawn to your company giving you a competitive advantage against everyone.
Especially through the Environmental component, analysing the trend throughout the years can assist in implementing effective Risk Mitigation policies. Risk management methods are always a boon to the organisation.
Along with investors, consumers are also drawn to companies that put sustainability as their top priority. In this growing world of consumerism, some companies cater to fast fashion and their factories which are known as “sweatshops”, violate ethical conduct and fair employment practices. By disclosing ESG policies to the consumers, it allows them to make an informed decision about which business to support.
You can learn more about how ESG has affected the Indian Corporate Landscape through the research paper “From Tradition to Transformation: ESG Initiatives in Indian Corporate Landscape”
Big corporations can set examples for smaller businesses on the ways through which ESG principles can be added to daily business functioning
We at GovEva provide ESG solutions to companies and assist in providing ways to achieve
Goals and comply with the laid down ESG standards. One of our clients is among the top 500 listed companies in the healthcare sector. The problems faced by the company were: lack of knowledge of the ESG domain, and a lack of processes to identify, collect and collate the data and present the ESG report, among many others.
Through GovEVA, client awareness and capacity building along with enabling them to digitally manage the data. Regular stakeholder participation was emphasized and given guidance in setting targets.
With GovEVAguidance, the client was successful in completing the statutory ESG report promptly and created a strategic improvement roadmap with digital workflows on the GovEVA Digital ESG SaaS Platform
The Tata’s are well known for their philanthropic work and show a strong commitment to social responsibility and sustainability. Various companies of the group such as Tata Steel, Tata Motors and Tata Power have made significant efforts to switch to renewable energy projects, carbon reduction plans and community development programs.
The Tata Sustainability group that was created in 2014 under Tata Sons serves as a resource for the Tata Companies. They provide and help the management to bring about sustainability and responsibility towards society and the environment.
Infosys, India’s top IT service company has prioritized sustainability, social responsibility and good governance. The company established measures to promote diversity, equality and inclusion in the workforce. Along with that, they incorporated a shift to renewable energy sources in their operations.
Infosys partnered up with Economist Imapct to bring about solutions for sustainability. These solutions include creating a Value Chain Navigator (VCN) for companies to understand and mitigate Scope 3 Emissions.
The company being another big conglomerate like the Tatas has integrated ESG practices into its business strategies. Their practices mainly focus on renewable energy, community building and water conservation.
The Swedish furniture retailer has made significant changes in its work procedures to incorporate ESG for a better future. The goal that it has set for itself for 2030 is to become “climate positive” where it aims to reduce significant amounts of greenhouse gases across all its supply chains. The company has heavily invested in solar energy to power all of its stores and warehouses. the company believes in ethical sourcing of materials and has responsibly managed forests.
After reading about these companies, you can now fathom how important it has become for companies to take on and implement ESG initiatives. It is imperative for organisations to be at the forefront of this change.
The top management has to give their 100% commitment to the changes to be made to shift and transition to the ESG initiatives and integrate them into the business strategy.
A comprehensive analysis of the current ESG performance provides us an idea and sheds light on the sustainability issues that need to be addressed.
Defining clear goals and setting a timeline can assist in achieving the goals. Setting targets helps in tracking the process and holds the company accountable if it fails to do so. Goals are to be set on the basis of immediate action, short-term and long-term taking ESG factors into account.
Including stakeholders such as the board of directors, workers and even customers in the decision-making process for ESG strategies provides an overall insight into what aspects of ESG reporting have to be considered. by including various stakeholders, it provides them with a sense of responsibility towards the growth of their company and make future investment decisions. For the customers, it generates loyalty and trust as the company they support is being accountable.
One of the best attributes of the ESG report is that it helps you identify and develop strategies to mitigate potential risks across the value chain, address environmental concerns such as extreme weather events and ensure compliance with rules and regulations.
It is important to conduct periodic training of the employees to keep them up to date with the recent regulatory requirements of the report and to help spread awareness.
Regularly publish your ESG reports as per the guidelines issued by SEBI. Use internationally acclaimed frameworks such as the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB).
Include shareholders too in the making of the report and the process of decision making.
Young and innovative minds on the team can always prove to be an asset. In this world of digitisation, we are constantly searching for new technology. Introducing new and sustainable technology can make new investors invest in your company
Implementing ESG strategies like energy conservation and efficiency, waste reduction, and switching to renewable resources can lead to major cost savings in the future despite the installation cost being high. these measures help increase profits.
Through transparent ESG reporting, it shows accountability to the investors. Companies prioritising sustainability tend to attract more customers, investors and business partners. This makes access to capital easier for businesses. Investors are eager to make investments in companies that take ESG reporting into account.
Demonstrating ESG commitment increases brand reputation and customer loyalty. Companies are perceived as responsible, sustainable and ethically governed. A strong reputation leads to increased market share, pricing power and consumer trust which in turn leads to higher sales and profitability. For businesses, it’s a way to prove to investors, employees and customers that they’re acting in the interests of the planet and society.
CONCLUSION
Environmental concerns have now become non-negotiable. Incorporating ESG strategies not only makes you responsible and accountable for your actions but also increases your brand value and customer loyalty. Through the example of big corporations, we understood which strategies were used to retain customer loyalty and give them a competitive edge. By incorporating these policies you can make a positive impact on society. We at Goveva assist you with incorporating ESG reporting and strategies for your business. We provide you with services such as report generation as per the standard framework, real-time action & progress monitoring and a lot more.
GovEVA is a leading cutting-edge digital ESG SaaS platform. Our vision is to empower large enterprises to digitize and streamline their sustainability journey, ensuring they meet their ESG goals efficiently and effectively.
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