Effective use of data can turn ESG pledges into innovative action

Often, environmental, social and governance (ESG) management feels like something out of our control. Pressure from customers, investors, and employees is mounting on businesses to show real progress towards ESG initiatives - forcing organisations to turn promises into actions, comments Siobhan Wilson, UK Country Leader, Oracle

With ESG spanning anything from energy consumption, to employee volunteering hours, to diversity statistics, it can be tricky and time-consuming for leaders to effectively manage ESG reporting and goals. Although 96% of business leaders want to make progress on sustainability objectives, 80% of business leaders remain frustrated with the lack of progress in this function. Business leaders want to rise to the occasion and make more progress, but many don’t know where to start.

ESG is more than just setting targets and enhancing brand image – it’s about how business leaders can come together, engage their staff, and effectively use data to create actionable goals and make real change.

Siobhan Wilson, UK Country Leader, Oracle

Real progress can only be made with effective leader and employee engagement

When teams are busy fighting fires, coping with disruption or strategising for the year ahead, it can be easy to let ESG initiatives fade into the background. The first step of the journey for business leaders is to make real time for ESG in their schedules. Establishing an ESG working group and dedicating time to meet on a regular basis is the vital first step towards progress.

However, the only way that this top-down approach works is with bottom-up buy-in. The new wave of millennial and Gen Z workers want to work for organisations that align with their values and tackle ESG as a core business imperative. Including employees in authentic conversations, encouraging them to offer ideas on how to improve ESG strategies, and communicating the importance of ESG across internal and external communications are just some examples of how to effectively engage employees in your company’s commitment to change.

This engagement and transparency should feed all the way through to setting ESG goals. Specific, measurable, and attainable targets encourage employees and leaders to take ownership of actions. For instance, setting goals for “One Big Thing” each year with an initiative that matters deeply to your employees, or deciding to use a percentage of profits to support global causes selected by the ESG working group. This kind of engagement and accountability mobilises large-scale change organisation-wide.

Data enables ESG success

With this effective engagement and transparency across the organisation, business leaders must look to how they can close the gap between intention and results. 91% state that they are facing major obstacles when implementing sustainability and ESG initiatives, and at the heart of this difficulty is a lack of data. 

Due to the organisation-wide nature of ESG data, spanning systems across finance, HR, supply chain, and customer experience applications, it becomes difficult to build a complete picture. When business leaders lack a single view of this data, it becomes impossible to accurately measure progress or find efficiencies to drive further improvements. Through integrating these disparate data sources into one enterprise resource planning (ERP) platform, ESG data can become a great, usable asset. Business leaders should look to invest in solutions that allow them to connect, manage and standardise data across all systems to enhance planning and execution and accurately report on progress.

AI takes ESG to the next level

Almost a third of business leaders state that one of their biggest challenges is time-consuming, manual ESG reporting processes. To get the most from ESG data, leaders must embrace emerging technology such as artificial intelligence (AI). Not only does this make it easier to collaborate across departments and track progress, but it also turns data systems into powerful recommendation engines, able to identify clear paths to meet goals.

For instance, using AI to bring supply chain, sustainability, and financial data together on the same platform enables leaders to pinpoint ways to reduce carbon emissions, minimise costs and find the most efficient routes and transportation methods. Meanwhile, these connected systems can quickly report on GHG Protocol Scope 1, 2 and 3 carbon emissions, and highlight the measurable impact of increased logistics efficiency on ESG goals.

This effective use of AI allows business leaders to collect data without error, no longer relying on multiple people to fill in spreadsheets correctly. Automation also reduces time spent on manually extracting and analysing data, enables better management of integrating complex data across global supply chains, and uncovers key ESG insights that can drive organisations towards hitting their goals.

We all have a role to play in our organisation’s ESG efforts. By engaging leaders and employees, working together to set collaborative targets, creating a single source of data, and effectively using AI, business leaders can make ESG a business imperative, not just a nice-to-have. 

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