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In today’s world, businesses are increasingly focusing on their environmental, social, and governance (ESG) impact. In order to bring transparency in business operations, companies are turning to ESG reporting, which dives into their influence on the environment, social responsibility efforts, and overall governance practices. This information is crucial for investors and other stakeholders to make informed decisions about the businesses they support.
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The Best Corporate Performance Management Software Solutions in UAE In...
Read MoreESG disclosure, similar to financial reporting, serves as a communication tool. It allows companies to inform stakeholders about their approach to ESG issues, promoting transparency and accountability. While ESG reporting is traditionally viewed as an external communication tool, the process itself offers significant internal advantages. Engagement in ESG reporting can enhance a company’s comprehension of its environmental, social, and governance risks and opportunities. This fosters a continual cycle of improvement, allowing the company to proactively address these factors and strengthen its overall sustainability.
Consideration of ESG factors in investment decision has become popular since the UN Principles for Responsible Investment (PRI) released in 2006. This initiative aimed to boost sustainable investing and started with 63 investment firms managing $6.5 trillion signing on. By June 2019, ESG investing had significantly grown, attracting over 2450 signatories with more than $80 trillion in assets under management.
The importance of ESG criteria is steadily rising. Major institutional investors are increasingly signalling their expectation of robust ESG commitments from the companies in which they invest.
2. Materiality Assessment
Materiality assessment is the cornerstone of the ESG report. It helps to zero in on the key environmental, social, and governance issues that matter most to the company and its stakeholders. This keeps the report focused and allows efficient resource utilisation.
3. Strategy & Goal Setting
Leveraging the insights from the materiality assessment, a well-defined ESG strategy can be established which outlines the company’s approach to tackling the identified key issues. Additionally, the strategy will encompass the formulation of measurable goals to gauge progress towards achieving the sustainability objectives.
4. Select an ESG Reporting Framework
There are different ESG reporting frameworks available such as GRI and SASB, which offer blueprints for structuring the report and required information. These frameworks also ensure the report is easily comparable. Companies should select the framework that is best suitable for their industry.
5. Measuring KPIs
KPI measuring has two stages in ESG reporting:
6. Verification and Assurance (Optional):
SAMESG® isn’t just another ESG platform; it’s a comprehensive companion designed to empower companies on their path to environmental, social, and governance excellence. Here’s how SAMESG® can transform your approach to sustainability
We offer the SAMESG® Solution, a sophisticated and advanced ESG platform that simplifies your sustainability reporting process. We offer you support for various ESG frameworks and assist you in automated decision-making.
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