Fatihah Ramzi, DigitalCFO Asia | 15 September 2022
Now that the race to digital adoption is calming down, the race towards sustainability is picking up.
Sustainability is becoming a part of daily life in the modern world. How does that relate to companies? As both consumers and employees want a more sustainable way of conducting business, a growing number of firms are exploring ways to lower their carbon footprint. Companies who don’t change will undoubtedly have difficulties in the future. No matter how big, how medium, or how little your company is, embarking towards a greener business should be a top focus.
However, putting the essential adjustments into place calls for a company-wide evaluation and teamwork. It frequently entails making significant investments in education, selecting new suppliers, developing new regulations, and drastically altering a number of procedures. But of course before that, companies need to know what to focus on. Here are the top two focus areas for the race to sustainability.
Reducing Carbon Footprint
When assessing the environmental impact that any action has on the environment, quantifying carbon footprint has become standard practice. It speaks to the volume of carbon dioxide that particular activity contributes to atmospheric emissions. When considering a simple bottle of water purchased by a business, for instance, the carbon footprint would include all emissions of greenhouse gases created from the sourcing of the water, the production of the bottle, and its transportation, as well as all the tasks completed in the water company that are required for that bottle to be produced and distributed to you.
Reduced carbon emissions will delay climate change, protect the environment, and provide opportunities for better use of the planet’s resources. This can be achieved via minimizing a company’s carbon footprint. Organizations can now calculate their overall greenhouse gas emissions using a variety of technologies. Hiring a sustainability consultancy company is a great choice when major change is required because they will not only quantify your carbon emissions but also develop a plan to reduce it, offer additional assistance during the implementation process, seek sustainability accreditations, and provide the necessary training.
Participating In ESG Reporting
An environmental, social, and governance (ESG) report, also known as a sustainability report, is a document that is released by a corporation or organization. It helps the business to be more open about the dangers and chances it confronts. It is a communication tool that is crucial in persuading dubious spectators of the sincerity of the company’s operations.
While corporate ESG data reporting is still largely voluntary in most nations, it is becoming more and more regulated globally. Companies that are proactive and future-oriented recognize how crucial it is to integrate ESG considerations into their mission and business strategy. In their yearly reporting, they willingly provide their ESG statistics. Companies with great ESG performance have shown to have higher investment returns, lower risks, and superior crisis resilience.
Companies will place a lot of emphasis on ESG transparency. In order to reduce investment risk, investors are progressively taking ESG factors into account. Investors can learn how a firm manages risks and produces long-term, sustainable financial returns by looking at ESG performance improvements and reports. However, businesses that fail to do so exhibit a lack of openness, and worried investors may pass them up as possible investments.
If businesses want to remain secure, competitive and long-lasting they will need to start aggressively embarking on the journey to sustainability as it is becoming a criteria worldwide for investment opportunities. Now that the race to digital adoption is calming down, the race towards sustainability is picking up. If businesses intend to be at the forefront of this race, they should start taking on greener initiatives and being transparent about it.