Transparent environmental, social, and governance (ESG) reporting has never been more important than it is today. With rising climate concerns and the increasing number of greenwashing scandals, companies must find a way to do their part and accurately report those efforts to their investors and the public.
While the social and governance factors are certainly important, it’s the environmental piece that’s of particular concern. Sustainability is the buzzword of our time, and having the right data is your company’s avenue for demonstrating that you’re making strides towards fully sustainable practices.
Whether you’re looking at your manufacturing processes or your commercial junk removal vendor, stakeholders want to know how you’re reducing your impact and working to reduce environmental harm. This is where having the right ESG data comes into play.
We’ll look at the importance of ESG data as well as some of the challenges reporting on these metrics presents – and then dive into how new digital solutions are resolving those challenges.
Why ESG Reporting Matters
Although environmental, social, and governance factors were only important for activist investors a decade ago, that’s no longer the case. Today, data shows that:
- 79% of investors say ESG reporting is crucial to their decision-making.
- Almost 50% of investors say they’re willing to divest away from companies that aren’t taking significant ESG action.
Financial regulators at the SEC are also looking into instituting ESG reporting requirements to ensure that organizations are honest about their ESG activities. There’s a good reason for this. Researchers have found that:
- 55% of funds marketed as fossil-fuel-free, low carbon, and low energy were over-exaggerated.
- More than 70% of funds that promise ESG goals fall short of their targets.
A case in point: $2 trillion was erased from the European market for sustainable investments following the introduction of anti-greenwashing rules. Experts expect the same thing would happen to U.S. markets if the SEC institutes ESG reporting regulations.
Reporting on ESG matters because it provides transparency to investors and customers, helping keep companies honest and far from greenwashing scandals. However, there are some notable challenges with traditional ESG reporting.
The Problems With Traditional ESG Reporting
If ESG scores and reporting are so important, why are so many companies hesitant to take them seriously? This is partly because it hasn’t always been easy to meet these standards.
In the past, businesses had to track their ESG metrics manually, which is quite arduous. ESG reports often require hundreds of papers and involve gathering volumes of data from multiple departments across an organization. It also often requires working with a slew of different experts and service providers.
Historically, once all the data was gathered, companies would input the information into spreadsheets to organize and analyze the data. However, this method is prone to errors and doesn’t allow for accountability or audits. Too often, a lack of expertise combined with unwieldy and unverifiable data makes ESG reporting a tiresome and inaccurate process.
But it doesn’t have to be. Thanks to technology and the unalterable data it can provide, ESG compliance no longer has to be so complicated.
The Critical Role of Technology and Authenticated Data
The secret ingredient for cracking the ESG code lies in digitally authenticated ESG data. In short, technology is key to ESG compliance – making it possible to have:
- Quick data compilation
- Simplified analytics
- Verifiable, auditable, and unalterable data
- The ability to track and improve
In other words, technology simplifies reporting, makes it possible to achieve ESG compliance without administrative hassle, and makes it easier to please investors and customers.
With technology, it’s much easier to ensure data accuracy and provide proof to investors and regulatory agencies that you’re actually doing what you say you’re doing.
Bringing Unalterable Data To Commercial Junk Removal
CheckSammy is a tech-forward commercial junk removal services and sustainability provider, offering customized junk removal services to a wide range of commercial clients.
We have a 4-step process for providing detailed waste diversion data, and our proprietary app and data collection process provide verifiable chain-of-custody data and granular reports for your ESG reporting. This data includes weight metrics to quantify your waste diversion efforts, and percentages for diverted waste types as part of our waste assessments.
To learn more about how we can help support your sustainability efforts, contact us today.
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