Giving Compass' Take:
- Here are three areas where technology can help in data gathering, reporting, and operations in ESG practices and help keep companies sustainable.
- Why is it crucial for companies to improve their sustainability practices?
- Read more about developing trustworthy ESG metrics.
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The demand for transparent sustainable and socially responsible practices is on the rise. This is because stakeholders, such as investors, customers, employees and regulators, want to have information on a company’s impact on the world. Environmental, Social and Governance (ESG) analysis can provide valuable insights and have a significant impact on the financial metrics of a company, and hence influence investment decisions.
However, collecting, measuring and reporting these non-financial data can be complicated and time-consuming. First, high-quality data might be hard to collect, as this data tends to be decentralised, wide-reaching and unverifiable. It comes from different departments and suppliers, in different formats. Second, due to the lack of standardised ESG disclosure obligations, businesses might find it difficult to choose which different templates and standards to report on their ESG activities.
To meet these challenges, there is a rapidly growing industry of ESG data management and reporting software to help companies capture, record, analyse and report such data across portfolios. In the United States, the software industry within the ESG sector is expected to reach $571.74 million by 2028, according to a new market research study.
Here are the three main ways ESG software can help companies on their sustainability journey.
- Data gathering: ESG software can help companies to gather ESG data in one place
- Reporting: ESG platforms can switch between sustainability frameworks and audiences
- Operations: Data-driven insights to guide business
Read the full article about ESG reporting at Eco-Business.