One of the few positive impact of the pandemic has been that it gave the environment some respite. Reduced economic activity due to lockdowns led to global carbon emissions to plummet. Cities across the world experienced significantly improved air quality, reduced GHGs emission, lesser water pollution and noise.

A research report by OECD, energy-related emissions declined by 7%, agriculture-related environmental pressures by less (around 2%). The reduction in the use of non-metallic minerals, including construction materials, reached double digits.

However, as the world slowly gets back to gaining some sembleance of pre-pandemic era normalcy, the question remains can we sustain the positive impact we reached at the height of the pandemic in the world?

If anything, the pandemic demonstrated the potential for collective action and change when faced with a perceived emergency.

Post COP26 event in Glasgow, to address climate change, over 100 countries volunteered to slash methane emissions. Not to be left behind, private entities dived in too –

• Jeff Bezos committed $2 billion to “restoring natural habitats and transforming food systems.”
• The Rockefeller Foundation, the IKEA Foundation and the Bezos Earth Fund launched the Global Energy Alliance for People and the Planet to tackle access to renewable energy across Africa, Asia and Latin America during the next decade. The alliance will also include governments and world governing bodies such as the Asian Development Bank, the World Bank, Italy, the U.K. and Denmark. (Source: Axios: The major climate pledges made at COP26 so far).

More corporates are expected to follow suit in the coming year. That said, taking the pledge is one thing, and acting on it or is another.

For enterprises demonstrating their sustainability status will require reporting on several parameters. Some of the most fundamental areas where data needs to be captured are:

• Environmental: air and water quality, levels of greenhouse gas emissions caused directly and indirectly by an organization
• Social: company’s treatment of its employees, customers, partners, and society. This could include benefits such as a percentage of payroll expenses, annual charity contributions and such
• Economic: specific economic indicators tracking the creation of value and reporting its distribution and reinvestment for future growth. For instance, research and development expenditures as a percentage of sales

Only when this information is in place is when the company can understand its baseline and set targets through programs and make projections towards accomplishing those targets.

Collecting accurate, detailed, consistent, and comparable data is crucial, and this is where the challenge stems from. A tall order given the several interconnected factors – capturing data accurately across different business units and levels and then bringing it to one place for further reporting or analyses are some of the biggest challenges businesses face.

The quality of sustainability reporting data is determined by 4 factors – volume, velocity, variety, and veracity. Executing it manually means dedicating significant time and resources to ensure data is collected from all resources in all its shapes and sizes and then ensuring it is all transformed into one format. If you are an enterprise collecting emissions data from your suppliers, and you do not have the right tools, you will most likely receive this data in spreadsheets scattered in endless cells and rows, with each supplier following a different format of recording this data – there is yet to be any standardization in this area.

Enterprises are conscious of the expectation to provide tangible and credible evidence of their sustainability status not just for the purpose of reputation but also because it makes business sense.

There have been several instances in the past where enterprises have faced penalties, devaluation of stock or had registrations revoked to conduct business in certain regions when they failed to comply with sustainability regulations. Less than ideal working conditions in factories in China and collapse of garment factories in Bangladesh led to serious repercussions for some of the biggest tech and fashion brands in the world, with stock value plummeting.

The increased pressure is leading chief sustainability and financial officers to look for ways to standardize relevant ESG data collection and reporting with robust solutions that will help them rise to the “big pledge” and measure performance against their sustainability goals.

Inaccurate or inadequate data collection negatively impacts the company. It leads to incorrect assessment of performance by key stakeholders – investors, rating agencies, communities, and suppliers all included.

Time spent on collecting inconsistent and inaccurate formats, validating them, and then further processing and reporting data, is considerably higher. At the same time, it takes a lot of effort to identify inaccuracies and correct them at a later stage.

One of the ways to accomplish sustainability goals will necessitate investments in the right area – particularly in a sophisticated ESG and Sustainability reporting solution that is designed to track an entire range of environmental, social, and governance-related data and report it in a way that is easy to understand for a variety of stakeholders.

A good ESG solution should go beyond the obvious and enable:

• Data integration from multiple sources
• Support to specific and varied sustainability functionalities
• Communication and alerts for internal stakeholders
• Easy and quick audit process
• Data reporting data as per key reporting standards
• Ability to scale with organization growth and ambitions

At Eka, we offer a cloud-driven Sustainability and ESG reporting solution that is highly configurable and enables companies across varied sectors to track, measure and report against relevant industry standards, regulations, and guidelines. The driven solution can be used as a stand-alone product or seamlessly integrated into the existing tech infrastructure that powers other critical business functions. If you need help in your Sustainability and ESG reporting, then reach out to us and speak with our Sustainability expert.