Researchers of a report from Verdantix and Wolters Kluwer, 5 Ways ESG and EHS Will Evolve Together in 2024, interviewed 150 key decision makers representing 27 countries and 10 industry verticals to see how companies are addressing both EHS and ESG priorities.
The key findings of the report are as follows:
Further integration of ESG is needed across business operations.The survey revealed that 85% of firms note investor demand for ESG compliance has prompted deeper scrutiny of their ESG and EHS processes, as well as their data and green claims.
Desire for reasonable assurance is increasing but not yet achieved. When asked what level of assurance companies are aiming for 74% said reasonable assurance for some or all metrics. However, the report found that immature data management procedures may not be able to meet these objectives.
Companies understand the need to digitalize and create new roles for ESG reporting. Some companies are establishing the role of an ESG controller, hoping to bridge ESG-related data flows between functions.
AI-enabled solutions can help link data. AI can be used to identify trends and patterns in ESG data, helping to improve strategy. However, the survey shows that 75% are yet exploring this capability.
Here are what respondents mentioned when asked about their largest ESG challenges:
- Scope 3 emission monitoring-- 17%
- Granular asset-level carbon emission tracking --16%
- Ability to develop climate scenario analysis-- 14%
- Identifying risk and opportunities from the transition to the green economy-- 13%
- Exposure to support and strengthen climate-related resilience -- 10%
- Obtaining data for and completing ESG Reporting--9%
- Assessment and management of ESG-related risks --8%
- Ability to produce relevant social impact metrics --7%
- Obtaining data for understanding and reporting nature-related dependencies, risks and opportunities --6%