Insight Article: How To Start Collecting And Reporting On ESG Data
16th March 2022
ESG Data for Large/ Complex Organisations
Managing an international business with multiple sites is challenging for the team at Headquarters. One of the greatest challenges is accessing the required information and data to effectively understand how the operations are performing. Add measuring and reporting on your organization’s ESG performance to the mix, and the complexity increases.
It doesn’t matter whether your business is in the fashion sector with thirty plus sites across a region, an electronics manufacturer with hundreds of sites around the world, or a retail organization with over five thousand outlets in five countries you have to collect, measure and analyse the data that is required to chart your ESG course.
One of the issues large companies struggle with is accessing the right ESG data, in the same format, in a timely manner. Below are some of the most common questions organizations have on this subject:
- The collection of basic data for calculating greenhouse gases (GHG) from each site is complicated for us, how can we do this better?
- After collecting the basic data, the GHG is calculated by applying emission factors, but it is difficult to know the emission factors for each country, what is the best way to do this?
- It is not easy to collect S (Social) data from all offices and factories, is there a faster and easier way?
- There are requests to disclose data not only for the company as a whole but also for each factory, especially Scope 1,2, and 3 emissions, how does a company pull this data together?
- We are receiving the data and information in different formats; excel spreadsheet, word documents and even a scanned copy of the electricity bill, what is the best way to streamline this process?
- Entering data separately for each framework is a huge amount of extra work; it would be useful to have a function that automatically assigns one piece of data to each framework, is there one available today?
Step one on your sustainability journey involves setting clear goals for the company to work towards, followed by creating a robust Environmental, Social & Governance (ESG) strategy to achieve said goals. Many companies struggle to figure out what key metrics they need to measure to track progress against their ESG goals.
To give you some insight, measuring Scope 1 and Scope 2 greenhouse gas emissions are essential, with Scope 3 becoming increasingly important. Scope 1 & 2 relate to the direct and indirect emissions a company makes, whereas Scope 3 relates to emissions not associated to the company itself, e.g. created by its suppliers.
Having a corporate ESG policy is only the first step on the ESG journey. The heavy lifting comes when you have to gather the data from all company sites, compare site to site performance, country to country performance and region to region performance. It is at this point the data and information must be analysed to understand the total company’s ESG performance.
Another critical step is understanding which global frameworks an organization is required to comply with. Once the key metrics are identified, the relevant data from all the company sites need to be aggregated to create a complete corporate analysis of ESG performance. See a further breakdown of the steps to follow below:
- Identify what framework is most relevant to the industry.
- Have a clear understanding of what data needs to be collected and why it is important to the business.
- Much of the data is potentially being captured by someone in a department, so reach out to all departments and explain what data is needed and if anyone is capturing it already and how.
- Standardise the format/unit of scale of the data and ensure reliability of the raw data. Don’t allow human manipulation.
- Consolidate data in HQ for interrogation. Disclose what you know and limit the number of assumptions.
- Present data in the format that is required by which ever stakeholder, e.g. TCFD for Financial institutions.
In this day and age companies must have a good ESG performance track record to win in the global business world. Therefore collecting, measuring, analysing, and reporting on ESG data is essential. To be successful in the current market organizations must have an ESG policy, including robust ESG goals, and accurately collect data to measure, analyse and track their ESG performance.
Turnkey Cloud Solutions provides the tools companies need to collect, measure, analyse, and report on their data across multiple locations and countries. Turnkey’s Sustainion™ can be configured to drill down as many layers within a company as needed to get a clear and understandable picture of a company’s ESG performance. It can even be configured to collect the necessary data needed to calculate the GHG/emissions by operational cells within a factory site.
Let’s say, as an example, Company A has operations in China, Vietnam, Sri Lanka and Turkey and each site is making the same product. Not only can Sustainion™ chart and compare the ESG performance of each site, but the head of sustainability can also compare the GHG/emission performance for the product across all the sites.
Please complete the form below or email us directly to discuss how Turnkey can help you on your ESG journey.
Environmental, Social & Governance (ESG) Tracking & Metrics – A Better Way Forward