Yup, the world has taken a new turn… and I’m not talking about post-COVID-19. Industries, governments, and the environment began adapting to new standards way before the world experienced the effects of COVID-19.
This is what is more commonly known as environmental, social and governance (ESG) data and numerous companies have defined it as a “must have” for supply-chain risk management.
Stakeholders are no longer willing to work with companies who do not take a genuine interest in incorporating ESG measures and let’s just say that investors are following along step by step. In addition, stakeholders and investors want greater transparency of information regarding issues such as carbon emissions and modern slavery.
That being said, as ESG standards and regulations are still developing and have not been considered a “concrete” measure like cybersecurity, companies need to understand what needs to be done to adhere to supply-chain compliance.
Let’s break it down.
What is ESG?
According to Investopedia ESG, “refers to a set of standards for a company’s behavior used by socially conscious investors to screen potential investments.”
In other words, numerous investors have this topic on their minds when it comes to making an investment decision. ESG guidelines and principles are expected to be incorporated into an organization’s culture and business strategy.
This is extremely important, but practically speaking, how do companies measure their carbon footprint and outline the specific steps to incorporate ESG into their supply chain and pipeline? For this, we need to have a better understanding of what each one of the pillars is referring to.
How can companies adhere to ESG standards?
As ESG is still a developing framework across the world, industry best practices based on experts in the field is usually what is adhered to.
In the United States, for example, there is not one body that has created a compliance audit for all companies to follow. Setting aside the political hemisphere, incorporating federal government law can reduce the flexibility and progress of the framework, not to mention that industries vary.
In contrast, the EU has a formal body (the EU Commission) that creates ESG regulations, but here comes the issue of trial and error to continuously stay up to date with standards.
In Singapore, a centralized registry exists where companies can upload all their ESG reporting, but this has only been recently implemented and has very little data currently.
Considering all of these alternatives, it seems the best solution for companies and organizations is to reach out to experts who provide software or auditing services that can review their ESG spectrum.
What can Findings do to Help?
Findings is a centralized, one-stop shop for enterprises and vendors to automate and scale their ESG assessment(s). We enable you to implement a sophisticated, straightforward, and efficient ESG vendor due diligence process.
Enterprises can use pre-built best practices assessments or can be custom-built according to an enterprise’s needs. Vendors can use our automated response to easily and quickly respond to incoming ESG questionnaires. Fast, automated, and at scale all in one place!