Feeling the heat lately? If you work in Environmental, social and governance (ESG) reporting, we wouldn’t be surprised. ESG reporting has grown in importance as companies face pressure to demonstrate their commitment to social impact and transparency. Now, companies are developing robust reporting policies to meet the standards of increasingly discerning investors.
It’s great news, but it's also hard work. If you're an ESG professional who’s been buried in data and spreadsheets every time reporting season rolls around, you might be surprised to learn you can automate your ESG reporting processes to focus on what matters most.
So, let’s explore what's possible with intelligent automation, and how the technology can help you keep up with the ever-changing, very extensive requirements of ESG reporting.
The challenges of ESG reporting
We’ve observed 3 main challenges when it comes to ESG reporting.
1. They know they're making a difference, but quantifying their impact is tough.
It requires serious investment to keep up the high quality of ESG reporting expected from investors. Smaller companies don’t have the resources to deliver an elevated level of ESG reporting - and it takes a lot of effort to reach and maintain the expected standards.
There’s a wide range of ESG reporting standards among the ASX200. 
Source: 2021 ESG Reporting Trends in the ASX200
2. They're seeing an evolving set of reporting frameworks to chase and report against.
There's a growing number of reporting frameworks, standards, targets and benchmarks to understand.
3. The data needed to report against these targets is all over the place.
It's quite a job to identify where the data should come from, but also to collect the data and get it out of various documents and systems. That means ESG teams are spending precious time and money on doing reporting instead of their main purpose.
Key opportunities for automation in the ESG sector
Concerningly, the World Economic Forum reports only 9% of companies are leveraging technology for data collection, analysis, and reporting in their ESG function. Automation is a valuable solution for your ESG reporting framework. But what does that look like in practice?
Environmental
Quantifying how your organisation safeguards the environment can be simplified using automation, which could conceivably transform how you measure and capture data on:
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- Plastic and packaging. Report on the use of sustainable or alternative plastics and track your results against UN Sustainable Development goals. Collect and analyse data from suppliers from various sources, such as invoices.
- Minimising waste. Automate recording, classifying, and tracing products from source to shelves to lower waste in your supply chain, including identifying whether your suppliers meet necessary sustainability certifications.
- Plans for climate change. Integrate climate goal data across various sites, including farms, factories, offices, and other facilities with your existing systems. Track carbon emissions against goals and standards.
- Water efficiency. Aggregate data from your water meters and use it to detect inefficiencies. Benchmark your water use against industry thresholds and monitor whether you are meeting minimum standards.
- Plastic and packaging. Report on the use of sustainable or alternative plastics and track your results against UN Sustainable Development goals. Collect and analyse data from suppliers from various sources, such as invoices.
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Other opportunities here include tracking progress in the areas of energy efficiency, transport and travel, and biodiversity.
Most excitingly, intelligent automation can help your organisation collaborate with upstream and downstream suppliers, collating data into a single source of truth: a real-time dashboard. Here, you can track your progress toward science-based targets, get alerts when you’re not meeting a standard, and course correct as needed.
Social
Next up in the ESG trifecta is social criteria – in other words, how you engage with people and community.
Automation can help you report on how your company engages with others, for example your employees, suppliers, or customers. Here’s how:
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- Employee training. Opportunities for employee training, upskilling, reskilling, and transition assistance can be assessed at regular checkpoints using an automated solution. An automated bot could assist reports on the percentage of employees receiving regular reviews.
- Diversity and inclusion. Automation can help collect data on gender and ethnic equality metrics, as well as pay fairness. The data could be easily filtered to provide insights on age group, gender and other diversity metrics.
- Employee well-being. Improve your wellbeing score by automatically gathering data on the physical and mental wellbeing of your employees. From a workplace health and safety perspective, automation can ensure employee safety by analysing historical data to identify “high-risk" zones and time periods.
- Community engagement. Automation can record interactions with the local community and Indigenous people. It can aggregate data to measure the impact of your programs and initiatives. Another opportunity for automation is avoiding food wastage by reporting on upcoming expiry dates, so food can be passed on to charity.
- Employee training. Opportunities for employee training, upskilling, reskilling, and transition assistance can be assessed at regular checkpoints using an automated solution. An automated bot could assist reports on the percentage of employees receiving regular reviews.
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Governance
Governance and risk management form the final piece of the puzzle when it comes to ESG reporting. Using automation to augment your governance reporting can give you superior visibility and insights into the following areas:
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- Safety hazards. Help document safety incidents and avoid future accidents by producing regular reports on hazards identified in the workplace, any incidents under investigation, and risk assessments. These insights could spot trends or triggers for safety incidents.
- Risk prevention. Get a bird's eye view of any external risks from third-party data sources, for example, weather information to conduct risk assessments with up-to-date information.
- Quality checks. Report on industry regulations and certifications like food safety and quality checks (FSQ) by automatically gathering data from several different sources – including suppliers or manufacturers.
- Standards and audits. Automation can support you as you consolidate information and guidance on implementing common ESG standards and frameworks, for example GRI, SASB, ISO or CDP.
- Safety hazards. Help document safety incidents and avoid future accidents by producing regular reports on hazards identified in the workplace, any incidents under investigation, and risk assessments. These insights could spot trends or triggers for safety incidents.
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How automation can help ESG professionals do more
Automation is poised to create huge opportunities when it comes to ESG reporting and, most importantly, help you do more.
Real-time reporting on the vast array of considerations for ESG would take an enormous investment of human resources to do correctly. But, there is another way! An automated solution can be a tool to help you make positive change for your organisation by ensuring your data is readily available for you to analyse and learn from.
Learn more about how intelligent automation can address the challenges of ESG reporting in our on-demand webinar here.
