Businesses that move to meet ever-increasing sustainability and ESG disclosure expectations head-on – and who are transparent about their process along the way – stand to gain a competitive edge by setting themselves apart as a responsible choice to consumers, employees, and investors alike.
Developing and executing a well-defined sustainability strategy is a collaborative effort that involves the entire organization and must be paired with effective change management processes. In addition to this is the challenge of communicating your sustainability endeavors in a compelling manner within a sustainability or ESG report, which can require months of manual labour.
How Can a Software for Sustainability Reporting Help?
When it comes to sustainability reporting, many companies struggle with the laborious and time-consuming process of collecting, reviewing and analyzing data from multiple sources. This is where software comes in to simplify the process and make it more efficient.
But first, a definition:
What is a sustainability or ESG software?
ESG or sustainability software is a tool that can help you to collect quality ESG data that you can then leverage when producing your reporting content and when managing your ESG or sustainability programs.
Features and capabilities of a sustainability software
Data collection and management:
ESG or sustainability software can automate the process of data collection from various sources, including internal systems and external stakeholders, and bring it into a secure system of record. This process will help you to refine the quality, accuracy, and consistency of your data.
Data analysis:
Such software should also help you to visualize your data, allow you to benchmark against your peers, and identify your gaps, all of which is key to developing performance improvement measures so that you are able s to reach your sustainability goals.
Reporting capabilities:
An ESG or sustainability software tool will help you prepare reports that meet the requirements of the most recent standards as well as tell a compelling story about your company’s sustainability journey. It will also help you in responding to various third-party questionnaires.
Benefits of Using a Sustainability Software Tool
Not only will sustainability reporting software fast-track your reporting campaigns, but it will do so while improving their quality, and thus increasing the strength of your narrative.
Value creation
Companies can create value from ESG reporting in a number of ways:
Better managed risks and opportunities: access to reliably managed and accurate data helps you to make informed business decisions, and in turn, improve your financial performance;
Reducing costs: analysis of the data can identify areas where operational improvements can be made, creating efficiencies and reducing costs;
Lowering the cost of capital: Better risk management and effective ESG reporting can attract investors who prioritize sustainable investments, increasing access to capital and potentially lowering the cost of capital.
These measures work together to improve your overall value in the market and can contribute to the long-term success of your organization.
Higher reputational capital
Many companies claim to prioritize their commitment to sustainability, but few are able to demonstrate substantial progress towards their goals. . Disclosing your sustainability efforts to investors and stakeholders can enhance your brand integrity – whether you have gaps to fill or not. Emphasis should be put on your commitment to improving year after year, not on being “perfect” today.
In today’s market, 60% of consumers say that sustainability is a significant factor when making purchasing decisions. And where consumer demands go, investor expectations follow. Companies that prioritize and follow through on their commitments to sustainable business practices are more likely to attract financial capital from investors, as well as from sources such as government procurement contracts.
Companies with strong ESG performance are also more likely to attract and retain the new generation of employees who prioritize sustainability and social responsibility in the workplace. .
Improved communication and transparency
An ESG or sustainability software will help provide the confidence you need to speak about your sustainability and ESG initiatives with clarity. Your data in not only centralized in a single and secure system of record, it’s high- quality and audit-ready.
Why Does it Matter?
ESG or sustainability software can help to alleviate some of the challenges surrounding the implementation of an impactful ESG strategy.
More often than not, sustainability teams are small. By automating the process of data collection, resource constraints are lessened, and your team can spend their time on change-making action items, instead of hunched over spreadsheets, tied up by manual and routine tasks.
Be prepared for upcoming regulatory changes
Even if your company is currently not required to disclose ESG information, it is becoming increasingly apparent that mandatory reporting will eventually become a standard business practice across all industries
By preparing your company with systems that are equipped to deal with the volume and complexity of ESG data, and its variety of formats and multiplicity of sources, you’ll avoid having to play catch up when regulatory changes arrive. And in the meantime, you’ll enhance your reputational capital by aligning your voluntary ESG reporting to the requirements of the latest proposed standards.
Who is Sustainability Software For?
Sustainability software is suitable for companies of all sizes, regardless of industry. Novisto provides assistance to organizations in effectively managing their ESG data, leading to the creation of more relevant sustainability disclosures. .
In today’s evolving ESG landscape, companies stand to benefit from using software, as they can more effectively .manage their ESG risks, take control of their sustainability narrative, and expand their capacity to assess ESG opportunities on a larger scale.
If you’re ready to create value from ESG data and reporting, reach out to schedule a demo with the Novisto team today. Whether you’re in the early stages of your sustainability journey, or a seasoned pro who is ready to move your team to a more sophisticated system, we can help.