Environmental and sustainability issues increasingly impact — both directly and indirectly — the governance choices of boards of directors, as well as stakeholders who are holding those directors' feet to the fire. Can sustainability software help cool the flames?
The World Economic Forum defines environmental sustainability issues as "...anything related to environmental impact or stewardship of the environment, including but not limited to climate change, resource scarcity, air or water pollution, waste disposal, and deforestation.'
Concern about climate change and other environmental issues loom larger than ever to your stakeholders, who use your environmental, social and governance (ESG) practices as one factor in their decision to invest in or support your company. Pressure from stakeholders has driven the topic upwards into the boardrooms of many corporations.
ESG metrics and reporting are the foundation for making ESG decisions and continuing compliance with standards. Software can assist the board and upper management with monitoring compliance and tracking performance across the company.
Using the proper software helps track initiatives and performance against standards. Also, it provides the data required to bring processes and policies into compliance. Several types of software fit the bill.
The 7 Best Sustainability Software TypesThese days, software types with varying capabilities are available to help you make sense of your sustainability initiatives.
1. Sustainability Performance and Project Management (SPPM) Software
Those with executive roles use SPPM software to improve their understanding of corporate sustainability performance and to track the progress of their sustainability projects.
2. Enterprise Carbon and Energy Management (ECEM) Software
Both executives and those in operational roles use ECEM software to manage, monitor and report a company's carbon footprint and consumption of resources.
3. Sustainable Product Development Software
Research and development teams and product managers use sustainable product development software to design greener, more environmentally friendly products.
4. Collaboration and Communication Systems Software
Today's businesses cannot thrive without clear communication and close collaboration between individuals, teams and management. Collaboration and communication software provides the conduit through which information workers, IT and HR can determine ways to reduce travel and improve workplace efficiency.
5. Smart Infrastructure Management Software
Building, facilities and operations management bring their A-game with infrastructure management software that helps them improve hard asset utilization. Buildings and vehicles add to the carbon footprint of many companies. Using these assets wisely cuts down on emissions and costs.
6. Sustainability Knowledge and Learning Management Software
ESG is a moving target. New information emerges daily about the best way to protect the environment and how to improve compliance with changing standards. Knowledge and learning management software ensures you can provide up-to-date information to management and staff as well as document continuing education efforts.
7. Sustainability and ESG Reporting Software
Data says nothing on its own. It requires interpretation and illustration to build an understanding of past endeavors and chart the next step in your ESG policies and processes. You need reports that show your level of compliance and an analytics package to deal with the mounds of data collected for all ESG initiatives and practices.Why should your board of directors care about ESG? And what sustainability software should you choose to keep your ESG on track?
Why Should Your Board Care About Environmental and Social Governance?Elevating issues to the board level can be difficult. The agenda is packed with multiple topics to be addressed, and directors are busier than ever. Until recently, environmental issues were nowhere near the table. The Diligent Institute Sustainability Report states there are three primary reasons ESG has come to the attention of leadership across all industries:
- Societal impact
- Long-term viability
- Reputational risk
These three elements are of concern to industries directly involved in environmentally impactful businesses, such as mining, gas and oil. They also concern other industries with less immediate considerations, such as financial and data industries, where sustainability in power generation is of primary interest. The insurance industry is concerned with the increased dollar amounts of damage from extreme weather events traced to climate change.
Even agriculture is affected. The cost to move existing products to environments where they will continue to thrive or develop new products that can withstand environmental changes is enormous.
With stakeholders and the public moving toward responsible stewardship, businesses around the world must find ways to reassure investors and customers that ESG is top of mind.
Where Are Boards With ESG Conversations?
Conversations surrounding sustainability and the environment are already happening. The Sustainability Report shows that 80% of companies had a board-level discussion on the topic over the last three years. Furthermore, 89% expect to have the same level of discussions or increase their frequency over the next three years. A third of companies expect to discuss sustainability at least quarterly.
However, nearly half of the respondents reported no established governance policies or practices related to ESG. One quarter said that such issues had no oversight within their companies, and 10% did not know whether their company governed sustainability.
The reason for the disconnect is the dynamic nature of the ESG landscape. Each organization is responsible for determining the appropriate approach for their industry, company and region of the world. However, once the conversation is initiated, many directors develop nuanced and substantive justifications to move forward with their governance policies.
Ultimately, the justification is evident: ESG software will help activate your company's effort to contribute to the broader goals of green organizations around the world.
How ESG Solutions Empower Companies to Move Into a Green New World
ESG Solutions define and activate a company's commitment to environmental, social and good governance causes. They turn standards and guidelines into tangible, measurable activities and outcomes. They gather pivotal intelligence from thousands of news sources and measure governance health, identify risks and highlight red flags. ESG software helps you visualize progress towards bold, long-term ESG promises.
Choose software that provides the information your particular organization needs to provide your board of directors with guidance. Sustainability software solutions are available to help at every level of management and for every need, from education to executive management.
Environmental, social and governance initiatives are not a fad. As the world continues to change, so must the business that wishes to remain viable, socially conscious and protective of its reputation.
Learn More About Diligent's ESG Solutions
Learn how Diligent's ESG solutions are helping companies operationalize ESG principles, track progress against standards, and monitor stakeholder sentiment.