Helping you navigate the complexities of Sustainability/ ESG (Environmental, Social, and Governance) disclosure and reporting.
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The fossil fuel industry faces many challenges in delivering affordable energy to the world while at the same time protecting the environment from carbon emissions.
We can taylor a relevant peer group to benchmark against based on market cap, area of operation, and product mix.
The final rule adopted on March 6, 2024, requires public companies to disclose information in three key areas: (1) climate-related financial risks, (2) GHG emissions, and (3) any climate-related targets or transition plans.
Why is it important for your business to develop and maintain sustainability disclosure and reporting. It is not just about doing good or meeting regulatory requirements.
Have internal stakeholders involved- form a dedicated team or committee responsible for ESG strategy, data collection, reporting, and engagement. This could include members from various departments, such as finance, operations, HR, and marketing.
Identify which ESG issues are most relevant to your business and your stakeholders. This involves assessing the potential impact of these issues on the company and the concerns of stakeholders like investors, customers, employees, and the community. Materiality is critical.
Based on the materiality assessment, determine which elements need to be included in your reporting, and, if appropriate, establish clear, measurable, and time-bound goals. Setting goals should be very carefully done to avoid the perception of green washing. Determine the key performance indicators (KPIs) you will use to measure progress against these goals.
Identify sources of data required for each metric. Establish processes for consistent data collection, validation, and storage, ensuring data accuracy and reliability.
Choose recognized ESG reporting standards or frameworks, such as the IFRS S1 and S2 standards supplemented by SASB Industry specific standards (there are 77 of them), the Global Reporting Initiative (GRI), or the Task Force on Climate-related Financial Disclosures (TCFD). Using established frameworks enhances the credibility and comparability of your report.
Regularly engage with your stakeholders (internal and external) to gather feedback and understand their evolving ESG priorities. This can be through surveys, focus groups, or one-on-one interviews.
Compile the collected data, insights, and narratives into a comprehensive sustainability report. Ensure transparency, addressing both achievements and areas for improvement.
Consider having the report externally assured. This adds an additional layer of credibility and assures stakeholders of the report's accuracy.
Publish the ESG report on your website and promote it through various channels such as press releases, investor communications, and social media. Ensure the report is easily accessible to all stakeholders.
After publishing, collect feedback, assess the effectiveness of the reporting process, and identify areas for improvement. Update your sustainability strategy and goals as necessary, reflecting the evolving business landscape and stakeholder expectations.
Sustainability is integral to your business strategy as it ensures continuous improvement and compliance with evolving environmental, social, and governance (ESG) standards. Regular sustainability reporting fosters transparency, engages stakeholders, and identifies risks and opportunities, enabling you to adapt proactively to regulatory changes and market demands. This ongoing process not only reinforces your commitment to sustainable development but also supports operational efficiency, innovation, and long-term financial performance by embedding sustainability into core business practices.
The ESG space is changing day by day, creating more uncertainty for decision makers
