ESG reporting is on a steep rise. Some of the driving factors include:
Escalating impacts of Climate Change: The consequences of climate change are undisputable, and the implications are vast. The 2022 Intergovernmental Panel on Climate Change (IPCC) report states that humans are “unequivocally” accountable for climate change, and without rapid action, the world’s 1.5 ºC target will slide beyond reach.
Regulation: The regulatory landscape around ESG reporting is evolving rapidly. The EU, which is seeking to become the ‘first climate-neutral continent’, is at the forefront of efforts to ensure that investors, financiers, and companies pursue more sustainable business practices. New EU regulations including the Corporate Sustainability Reporting Directive (CSRD) and EU Taxonomy have been introduced to improve transparency around ESG performance.
Investor, Customer, Supply Chain, and Employee Demand: Investors, customers, suppliers, and employees, are increasingly demanding transparency around sustainability performance. In response, many companies not yet required to disclose their environmental, social and governance performance by law, are choosing to do so using a variety of voluntary reporting frameworks.
A post-pandemic focus on corporate responsibility: Many view ESG as essential to mitigating societal inequalities that were exposed and exacerbated by Covid-19.
Future-Proofing Strategy: Asides from the external incentives to develop an ESG strategy and disclose sustainability performance, companies are increasingly recognising that an ESG analysis provides an essential underpinning to long-term strategy development. The work necessary to prepare a comprehensive Sustainability Report requires an organisation to identify the short, medium, and long-term impacts, risks, and opportunities associated with environmental, social and governance changes and find innovative ways to adapt. This process supports businesses in preparing themselves for the inevitable changes ahead. It is unsurprising that an increasing body of research shows a positive link between ESG performance and financial performance.
UpThink Innovation Agency offers our clients support and guidance in crafting innovative and achievable sustainability and ESG strategies, including strategies for sustainability and ESG reporting and circular economy design. We also provide briefing sessions for Boards and Leadership teams. We would be delighted to talk to you and explore further how we can help. Please contact Mary Cronin.