ESG reporting? Yes, but also...
Manage your ESG assets to generate impact and improve your company's profitability. The mere ESG reporting is no longer sufficient or differentiating. The active management of material ESG reporting aspects is today becoming a competitive advantage. World leaders such as SASB o GRI have already been working on this dynamic for some time.
What is ESG active management?
The concern for an active management of ESG (Environmental, Social and Governance) aspects is becoming more and more present in the world's business world. Boards of Directors of companies.
This term, which comes from the investment world and reflects the non-financial criteria that many already use when valuing their potential investments, highlights the need for companies to incorporate the social and environmental impact at the heart of their activity in order to be profitable in the medium and long term.
Why ESG reporting?
Many companies are already looking for ways to actively manage their ESG aspects as a way to improve their ESG ratings score and, therefore, to facilitate the access to capital, adapting to the regulation constantly evolving, not to lose its market share competitors and take advantage of all the opportunities that this type of practice offers them.
93% of CEOs* consider it important to put sustainability at the heart of their companies and are focusing their efforts in this direction. This movement is leading to the day-to-day transformation of entire sectors and the repositioning of many companies, which requires moving forward in order not to be left behind.
UNCG "CEO Study on Sustainability", 2019
Proactive management of ESG issues can translate into:
- Innovation opportunities with impact (new business models, products/services, customer segments).
- Increased efficiency, rethinking the way you operate your business
("doing more with less").
- Reducing risks and improving positioning.
ESG reporting regulation
Regulation is moving rapidly in this direction, seeking to create greater transparency and comparability around the contribution that companies make to society and the environment. Much of this regulation is driven by the European Union and has a direct impact on how companies operate and report their performance. Examples in this direction are:
- Non-Financial Information Reporting Act 11/2018.
- EU Green Pact.
- EU Sustainable Finance Action Plan. Restructuring funds focused on sustainability and cohesion.
- The EU is finalising its Recommendation on the Non-Financial Reporting Directive (NFRD).
Access to capital
Around $30 trillion, one third of professionally managed assets globally, are already subject to ESG compliance and monitoring.
Between April and June 2020 alone, investors invested more than USD 70 trillion in ESG funds, indicating strong growth in ESG investments. In addition, 75% of investors apply ESG principles to at least a quarter of their investment portfolio.
Why can Transcendent help you with ESG reporting?
Transcendent is a consultancy specialising in Benchmark Business Impact in Spain. We have extensive experience in assisting all types of companies in the management of ESG reporting aspects, turning them into a lever for improvement of its activity.
Contact us at gestionactivaESG@transcendent.es