Regulators are pushing for change, evident in the Corporate Sustainability Reporting Directive (CSRD). This directive aims to intertwine non-financial elements with strategy and financial performance, emphasising the importance of resilience and double-materiality in a company's approach.
The need to modernise and digitalise ESG reporting and management practices is both pressing and complex.
Businesses have long invested in ESG reporting, developing extensive practices for data collection. Despite this, reliance on manual processes, undocumented procedures, and individual knowledge persists, coupled with a lack of governance and technologies in place.
Driven by regulatory demands and stakeholder expectations, companies are advancing their ESG reporting capabilities. However, the drawbacks of unstructured manual data collection are becoming more evident, compelling a digital transformation in ESG practices as a strategic imperative, rather than a choice.
In our experience, we have noted three pillars crucial for ESG digital transformation: a solid ESG data foundation, proper governance, and suitable technologies.
Designing the described architecture and establishing the necessary structure is complex. Collaborating with a knowledgeable implementation partner is key. We as SFX and Deloitte are prepared to support and guide our clients throughout their sustainability journey and would be happy to support the implementation of best market practices in your company.
Proactive ESG readiness is vital. Conducting gap assessments, establishing robust controls, and embracing best practices enable navigation of this intricate landscape. ESG must transcend regulations, fostering responsible, sustainable and resilient business practices. This commitment can be a competitive edge, enhancing brand image and fostering increased customer loyalty, and ultimately helping to shape a more sustainable future.