Many businesses are starting to figure out their ESG strategies. It’s not always easy to start, or know what the business is ready to do. Taking on an ESG programme can seem like a big challenge, but actually many businesses are already doing a lot on ESG already, and a big part of getting started is pulling together existing data.
On our recent webinar on How to Implement an ESG programme, we surveyed over a hundred leading businesses and law firms on what they are doing around ESG.
Implementing an ESG programme can seem like a daunting task. From reporting methodologies to external ratings, there’s a lot to consider.
In this webinar, we explored the steps that any business can take to begin thinking about an ESG programme. Whether you have an extensive, carbon-heavy supply chain or are in professional services, ESG reporting doesn’t have to be complicated.
This webinar covered:
How to start thinking about implementing an ESG programme
Which ESG reporting frameworks are relevant to your organisation?
How to classify existing initiatives under ESG
Why ESG programmes can be beneficial to any organisation
ESG regulations are government standards for ESG actions or disclosures. While the ESG space is mainly unregulated, legal requirements are coming in different countries and at different paces. Some are already in force and certain businesses may already find themselves having to undertake ESG disclosures depending on their size and industry.
There are varied reasons to begin the process of implementing an ESG programme. Preparing your business for an ESG programme could be driven by a variety of different factors. Your business might be looking for investment or might want to attract the best talent as an employer of choice.
One example of a driver is because of a scandal or tragedy. The collapse of the Rana Plaza building in Dhaka, Bangladesh in 2013 led to the death of more than 1,100 workers. This event put intense public pressure on international clothing retailers, questioning practices across the industry, independent of whether the retailer had sourced from this facility. Fashion retailers have taken concerted action to improve safety in their supply chains, even if they are several tiers removed.
What is an Environmental, Social, Governance (ESG) Committee?
An ESG committee has overall responsibility for the effective operation of a company’s ESG policy, and has delegated responsibility for overseeing its implementation. The committee reviews data from across the business and then filters and summarises it for the board. The ESG committee is responsible for writing the ESG content in the company’s annual report and producing all information relating to ESG disclosures.
How Do You Know if Your Business is Ready to form an ESG Committee?
Forming an ESG committee is a crucial step to get started on your ESG journey. It can be informal and ad hoc, but bringing in more than one person or department will help to deliver on your ESG goals.
Before you decide to form an ESG committee, you should think about your ESG maturity. Understanding where your business sits on the ESG maturity framework will help ensure that you are doing things in the right order and at the right time. There’s no point in forming an ESG committee for example if your business is not planning any investment whatsoever in ESG efforts.
It depends on how committed your business is to ESG
ESG consultants help companies determine what actions they should take to improve and build on their ESG efforts. They can undertake risk assessments, due diligence and impact assessments, as well as help to prepare reports and measure impacts.
They can also help to develop the right structures and processes inside the organisation if you are preparing for ESG disclosures. If you’re just getting started with ESG, you should also read our explanatory guide: ESG: What Businesses Need to Know. That guide provides a summary of the key terms and concepts you should be aware of before diving into ESG in more depth.
The UK just hosted the UN Climate Change Conference, known as COP26. This summit is one of the most consequential climate events since the negotiation of the Paris Agreement in 2015 and was attended by world leaders, politicians, business chiefs, climate change campaigners and sustainability experts.
With increasing ESG regulations coming across the world, particularly on the environment, what will the international effort to tackle climate change mean for environmental compliance?
In this webinar, we dissect government and international commitments following the conference and discuss what that means for businesses working towards net-zero.
We were joined by James Alexander, Chief Executive of the UK Sustainable Investment and Finance Association. As well as the impact of COP26, we heard from them about ethical investing and how businesses can set themselves apart through net-zero commitments and ESG compliance.
The webinar covered:
Current environmental regulations for businesses and what might change
The impact of COP26 on compliance
How companies can work towards net-zero
Understanding ESG reporting and preparing for ESG regulation
ESG – Environmental, Social and Governance – is the hottest acronym in the business world today. Global businesses are no longer working on environmental, social and governance issues in a silo. They are bringing them together under the banner of ESG to demonstrate the positive impact the business is having on the world.
By combining issues like carbon emissions, progressive hiring practices and strong compliance, businesses can show not only are they a sound investment, but they have a net positive impact on the world. ESG is about assessing that net positive impact in the world, and taking concerted, defined and measurable action to improve it.
VinciWorks has created a comprehensive guide about ESG that explains what it is and advises businesses on all they need to know and what steps they can take to work towards becoming ESG compliant.
ESG – environmental, social and governance – are three factors that businesses can use to measure their net impact on the world. Broader than profit and loss, more detailed than corporate social responsibility, ESG reviews, details and documents how a company impacts on the environment, on society and people, and their own corporate governance.
What is the main purpose of ESG?
A myriad of factors can make up an ESG report. Some stretch to over 1,000 individual data points, from carbon emissions to the proportion of women on the board to how frequently a company undertakes bribery training. Many businesses are no longer working on environmental, social and governance issues in a silo. They are bringing them together under the banner of ESG to demonstrate the positive impact their existence is having on the world.
Bringing these disparate risks together helps a company prioritise their impact on the world. It helps them understand the risks they face, and it shows stakeholders they are taking the time to conduct due diligence and mitigation measures on those risks.
What’s changing in the world of mandatory corporate compliance?
The EU’s proposed new corporate due diligence and corporate accountability directive will cover companies that sell to the EU, not just those based there. Businesses will be required to identify, address and remedy their impact on human rights and the environment. Crucially, this is likely to go up and down the value chain, which means customers as well as suppliers. Businesses could be sued inside the EU for human rights violations or environmental damage committed by their customers or end-users of their products in third countries.
