Sustainability & ESG Insights February '24: Rising APAC Sustainability Legislation and the need for ESG data and software

??Via this monthly newsletter, we'll share more knowledge and content about what's arguably the most important domain of our generation: Sustainability and ESG. The goal is to inspire and share insights so each and every one of us can make a difference in the Environmental, Social and Governance domain we call Sustainability.

Valuable ESG and Sustainability news of February '24

??In this months’ newsletter:?

- 1.5 degrees Celsius has officially been breached

- KPMG survey highlights the need for established ESG software

- Global investments in clean energy technology has increased?

- Harvard Article: The changing dynamics of ESG consideration within Corporate Sustainability

- BCG Article: the importance of Sustainability data in the future

- Singapore to introduce mandatory climate reporting beginning 2025

- Mainland China’s stock exchanges issue first guidelines on corporate sustainability disclosures

- And more…

1.5 Degrees Celsius Has Officially Been Breached

The European Earth Observation Agency's recent data reveals a disconcerting milestone in the realm of climate change. For the first time, the average global temperature has surpassed the critical benchmark of 1.5 degrees Celsius above pre-industrial levels over 12 months. The findings from the Copernicus Climate Change Service (C3S) indicate that the global mean temperature for February 2023 to January 2024 reached an unprecedented 15.02 degrees Celsius, exceeding the 1.5C threshold set in the 2015 Paris Agreement. However, it is crucial to emphasize that while the breach raises concerns, it does not imply a failure to uphold the Paris Accord, as the agreement focuses on a longer-term temperature increase spanning more than a decade.

Read the details via the link below.

KPMG Survey Highlights The Need For Established ESG Software Systems

?? Insights on ESG Data Management: Bridging the Gap

?? The recent KPMG US survey sheds light on a critical challenge faced by large companies. Despite the escalating focus on ESG reporting, nearly half of these organizations persist in using spreadsheets for managing their ESG data. This reliance on outdated tools poses significant hurdles.

? Survey Highlights:

Investment Intentions: A staggering 90% of executives express their commitment to bolster ESG investments. These investments span dedicated personnel, specialized software, and training.

Reality Check: However, there exists a substantial gap between perceived ESG reporting capabilities and actual readiness. 47% of companies continue to rely on spreadsheets, a practice that falls short of the evolving landscape.

Strategic Imperatives:

Strategic Shift: Companies must recognize that ESG reporting extends beyond compliance checkboxes. It’s a strategic imperative—a reflection of organizational values and long-term sustainability.

Precision and Efficiency: To bridge the gap, consider:

AI and Machine Learning: These technologies enhance data analysis, providing actionable insights.

Formal ESG Strategies: Develop comprehensive sustainability frameworks that align with business objectives.

? Conclusion: As the ESG landscape evolves, organizations must transcend spreadsheet limitations. Strategic investments and a broader sustainability vision will empower effective communication of core values.

Remember, ESG isn’t merely a trend; it’s a compass guiding businesses toward a responsible and resilient future. ????

? Check out more insights via the article below!

Global Investments in Clean Energy Technology has Increased 17%

?? Global investments in the low-carbon energy transition hit a record $1.77 trillion in 2023, up 17%, electrified transport grew 36% and outpaced renewable energy spending by $20 billion.

? To achieve net-zero goals, there's a need for an annual average of $4.8 trillion in investment from 2024 to 2030 to achieve net-zero goals.

? Read more about this topic via the article below!

Read more via the link below.

Harvard Article: The Changing Dynamic of ESG Consideration within Corporate Sustainability

A recent Harvard Business School article explored the impact of ESG issues on corporate profitability, presenting a framework tracing their evolution to pivotal factors. Using Purdue Pharma as a case study, it highlights increased understanding of ESG materiality, with companies measuring and reporting on ESG data.

The framework offers insights for entities balancing financial and societal motivations, stressing the catalyst role of designating ESG issues as "financially material." The authors aim to shift perception towards proactive management of emerging ESG issues in corporate decision-making.

Recent BCG Article Underscores Importance of Sustainability Data in the Future

?? Insightful article “Sustainability Data Is a Big Opportunity in Information Services” by Boston Consulting Group (BCG) and here are Sustaira 's key points:

?? Globalization significantly influences the business landscape, transforming operations and opening up new markets for businesses of all sizes. It has become a driving force in today’s business world and revolutionized the way organizations operate, creating fresh avenues for growth.

?? Sustainability data presents a substantial opportunity within information services, as global organizations can leverage this data to drive positive environmental and social impact.

?? While the potential is immense, challenges exist in collecting, analyzing, and utilizing sustainability data effectively. Companies that navigate these challenges stand to gain a competitive edge.

?? Organizations should prioritize sustainability data as a strategic imperative. By harnessing this data, they can contribute to a more sustainable future while unlocking (new) business value.

? Read more via Sustaira's summary below!

Singapore to Introduce Mandatory Climate Reporting Beginning 2025

As shared by ESGToday , Singapore will implement mandatory climate-related reporting requirements for listed and large non-listed companies, with obligations for some to begin disclosing in line with the IFRS’ International Sustainability Standards Board (ISSB) standards starting as early as 2025.

The new rules were announced today in the Parliament of Singapore by Second Minister for Finance Chee Hong Tat, with details of the new mandatory reporting requirements subsequently released by Singapore’s business reporting, accounting and corporate services and markets regulators the Accounting and Corporate Regulatory Authority (ACRA) and Singapore Exchange Regulation (SGX RegCo).

Following the recommendations of the Sustainability Reporting Advisory Committee (SRAC), a committee set up by ACRA and SGX RegCo to advise on the roadmap for advancing companies’ sustainability reporting in Singapore, the new climate reporting obligations will be implemented in a phased approach, beginning with listed companies in 2025, followed by large, non-listed companies, defined as those with at least $1 billion in revenue and $500 million in assets in 2027.

Read more via the link below:

Forbes article: The Best And The Rest: The Sorry State Of Sustainability Today

Last summer Professor Alison Taylor (who has just published an excellent book “Higher Ground: How Business Can Do the Right in a Turbulent World) and I published an article in the Harvard Business Review titled “The Evolving Role of the Chief Sustainability Officers.” The tagline asserted “They once focused on optics and reputation. Today many are interacting with investors and helping set strategy.”

Our article was based on interviews with 29 leading CSOs and 31 investors. We noted that “Historically CSOs have acted like stealth PR executives—their primary task was to tell an appealing story about corporate sustainability initiatives to the company’s many stakeholders, and their implicit goal was to deflect reputational risk.” In the companies we studied this was changing rapidly over the past two to three years. Interestingly enough, this was especially apparent for companies in challenged industries such as athletic wear (e.g., Nike), food and consumer goods (e.g., Unilever), electric utilities (e.g., AEP), mining (e.g., Vale) oil and gas (e.g., ConocoPhillips), packaging (e.g., Greif), retailing (e.g., Groupe Casino), and tobacco (e.g., Philip Morris International).

Read the complete article via the link below:

Major carbon emitters in Canada are still not taking net-zero targets seriously

Climate Engagement Canada analyzed 41 publicly traded emitters and found that more than half were lacking "credible net-zero transition strategies"

Less than half of Canada’s major carbon emitters have adopted net-zero targets, and none have committed to aligning their capital spending with plans to reduce greenhouse gasses, according to a report from Climate Engagement Canada (CEC).

CEC, which comprises 41 of the largest asset managers in Canada, with $5.2 trillion under management, assessed 41 of the top emitters that trade on the Toronto Stock Exchange on their climate-related commitments, disclosure and governance. The benchmark, released in December, found that 44% percent of these companies have established a qualitative net-zero target that covers all or nearly all of their direct operations – meaning more than half have not. And most have no short-term emission-reduction targets.

“However, the lack of 1.5C-aligned short-term targets suggests that additional work is required to demonstrate credible net zero transition strategies,” CEC said in the report.

Read more via the link below.

Mainland China’s stock exchanges issue first guidelines on corporate sustainability disclosure

- The guidelines are aimed at ‘guiding listed companies to practice the concept of sustainability, and promoting the high-quality development of listed companies,’ said Beijing Stock Exchange

- They encourage companies to disclose their sustainability data based on four core areas – governance, strategy, risk management, and metrics and targets

Mainland China’s three main stock markets have released their first guidelines for listed companies to disclose their sustainability-related information, a landmark in the country’s progress towards achieving a sustainable economy and embracing the global environmental, social and governance (ESG) boom.

The Shanghai Stock Exchange (SSE), Shenzhen Stock Exchange (SZSE), and Beijing Stock Exchange (BSE) published separate guidelines on corporate sustainability disclosure and started seeking public opinions on Thursday.

Read more via the link below:

??Of course there are many more insightful articles, so please share your thoughts and recommendations in the comments below.

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