Spark Newsletter – August 2022
Sustainability is not just about tackling environmental risks. It is about creating resilience, and this is where?ESG?comes into play.?A spotlight is being put on ESG and sustainability performance as regulatory agencies around the world work toward standardizing ESG reporting metrics. This means ESG reporting is quickly moving from being a voluntary exercise to a mandatory one.
With all of this in mind, this month’s newsletter focuses on:
The Need for Investor-Grade Data in ESG Reporting: What Companies Should Know
As ESG reporting is quickly moving from being a voluntary exercise to a mandatory one, the need for quality data is increasing as well. As we’ve seen in the past few months, investors, regulators and the public are demanding transparent reporting on the impact companies have on the environment, as well as the impact of climate change on companies’ performance and outlook.
To meet these challenges head on, companies will need to have a holistic approach to collecting and reporting quality ESG data in order to meet climate targets and the expectations of investors, regulators and the public.
At Sphera’s ESG Summit that took place June 21-23, 2022, Kim Knickle, research director of ESG and sustainability at Verdantix, detailed how companies can produce investor-grade ESG data and optimize ESG performance.
What is Double Materiality and How Does It Apply to You?
If you’ve been tracking ESG regulatory developments this year, you’ve been busy. The EU is at the forefront of regulatory and policy activities designed to protect the environment and mitigate climate change. Recently, the EU effort has been most visible in the Corporate Sustainability Reporting Directive (CSRD) and its European Sustainability Reporting Standards (ESRS). The U.S., while still catching up, has taken a big regulatory step forward through the climate-related disclosure requirements proposed in March by the Securities and Exchange Commission (SEC). The concept of double materiality features in both sets of requirements.
The CSRD reporting standards are slated for formal approval and adoption in October this year, and the SEC requirements may go into effect as early as December. As companies come to terms with these reporting requirements, they need to ensure that their approach to sustainability reporting encompasses the climate-related risks and opportunities presented by climate change, as well as the impact their operations have on climate change and the environment.
The Importance of ESG Strategy
The pandemic year has taught us that Sustainability is not just about tackling environmental risks but much more. It is about creating resilience into infrastructure, and this is where the Environmental, Social and Governance (ESG) conversation comes into play.
There is a heightened social, corporate, governmental, and consumer attention on the impact of corporations. The U.S. Securities and Exchange Commission (SEC) recently stated that corporate disclosures on ESG issues will be a high priority for them. Investors are looking for a strong ESG proposition to protect their interests and the company’s success. The fine line between doing good and what is profitable is fast diminishing. According to the SEC, efforts to maximize the bottom line and the pursuit of the public interest are complementary.
ESG, the Circular Economy and Opportunities Missed
James Pearson, a senior product manager in Sphera’s article compliance division, joins the SpheraNOW podcast to discuss ESG, the circular economy and missed opportunities.
During the conversation, James talks listeners through some current system terms to be aware of:
"So when you’re thinking about the current system terms, there’s a couple of terms that you might think of and listeners might actually be aware of them. So ‘take, make waste’ is one term that’s often used to describe it. An alternate is ‘take, make, use waste,’ and then you’ve got things like ‘cradle to grave’ as well. And it’s basically an indication of the product life cycle within that material economy, our current materials economy. But the key point is that we’ve got this waste phase, and that essentially results in the products that we use and that we buy being disposed of in let’s say a desirable manner."
5 Tips for Sustainable Success
Sustainability information spans operations, buildings, products and supply chains and resides in many shapes and forms inside the organization and across its value chain. Once captured, this information empowers enterprises to improve the use of raw material, energy and resources and to reduce carbon emissions and waste.
This is a statement made in an article back in 2012, 8 years ago. It is still very true. Today we know through experience that sustainability information needed in business operations has become a greater driver, more relevant and more critical than ever before. It may have seemed at the time that the primary goal of generating a company’s sustainability profile was to optimize resource use, minimize waste and emissions.
Sustainability | Climate Change Adaptation | Sustainable Fashion
2 年Thank you for this. I read the tips for sustainability. I especially liked how you outlined that sustainability information should be presented and integrated in the company's strategic business approaches, management and targets. It is so true that companies should also use their data to inform their sustainability agenda. I look forward to reading the other articles.
Senior Technical Consultant @ Sphera | Agile SQL Leadership
2 年So many wise words of wisdom in plain sight ...