Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members

Digitizing ESG

ESG happens to be one of the biggest issues in the world of business today, while corporates have set about including the ESG roadmap into their operative and governance systems, yet, for any corporation to take ahead their ESG commitments inclusion of an ESG compliance path for their supply chain becomes imperative. Data plays a pivotal role in tracking an organization’s progress on ESG issues keeping the holistic picture in mind. The process from gathering data across the value chain to keeping it updated for monitoring and benchmarking requires dependence on multiple sources both internal and external including partner companies or vendors.

ESG compliance integration: challenges and complexities:

The complexities of integrating ESG compliance across the value chain remain common among larger organizations across industries across logistics, manufacturing, and consumer goods, among others. A holistic integration mechanism involves adherence to key industry benchmarks and practices across all business models such as sourcing, production & manufacturing, facility management, human resource functioning, and the like.

Tracking the ESG roadmap for a company along with this value chain increases the difficulty level of data accumulation. This, coupled with the significant challenges in data management has necessitated the need for a solution that can help bridge the gap between reporting and implementation of ESG compliances.

Using digital platforms to bridge this gap:

In order to address this issue, organizations must be empowered to undertake adequate monitoring and risk assessment of their supply chain partners. This will help drive higher business efficiencies by unlocking the true potential of their supply chain. A digital platform that enables companies to capture data and the supply chain to assess themselves on ESG parameters offers a comprehensive solution to bridging the gap between planning and implementation.

The following are salient features such a platform must be able to offer to supply chain business partners:

  • Self-assessment and Benchmarking: A digital platform helps provide a 360-degree assessment of an organization’s ESG preparedness by undertaking a thorough assessment through a strong monitoring system. It provides inputs on adherence to global ESG market regulations such as UNGC, GRI, and UNSDGs, among others. This is especially recommended for companies that wish to work with larger conglomerates or global companies
  • Risk Study: Apart from providing a comprehensive assessment of an organization’s current ESG standing, a digital platform also helps share inputs on gaps in ESG compliance and provides a detailed framework to prevent further operational and reputational risks, thereby providing an efficient roadmap to achieving sustainability goals
  • Transparency in Evaluation: A transparent scoring and evaluation system is the hallmark of an end-to-end digital platform. Scores and dashboards are readily available for reference and to maintain transparency in the overall evaluation mechanism
  • Provides Certification: Technology and digitalization have blurred geographical boundaries opening possibilities for many supply chain business owners to look beyond borders to forge partnerships with larger organizations. Valid certification backed by scientific data and analysis helps these businesses make themselves more relevant in the entire business ecosystem by expanding business operations and cementing partnerships with global organizations which may choose to work only with credible, certified businesses
  • Specialised Counsel: In a constantly evolving paradigm of conducting business, a guided approach to achieving larger ESG goals is crucial. A specialized, niche digital platform partnering with some of the world’s important organizations helps drive significant efforts towards making ESG compliance more mainstream than before

Regular and proactive sharing of data against mandated industry benchmarks has helped increase information transparency in a business ecosystem increasingly rife with new challenges. Comprehensive data management coupled with accurate interpretation will ensure ESG compliance becomes easier and more seamless. This is imperative to achieve larger sustainability and inclusion goals for businesses.

Authored by

Wilfred Sigler, Senior Director – Market Development & Digital Solutions, CRIF India

Edited by Queenie Nair

Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Economic Times – ET Edge Insights, its management, or its members