More than ever, environmental, social, and governance (ESG) issues are high on the corporate agenda. At the same time, 2022 is a year of financial turmoil for many companies. The aftermath of the corona crisis and the war in Ukraine are driving up prices, especially for raw materials, energy, and semi-manufactured goods, so staying in business is a key issue. Therefore, it is logical that many companies are wondering what they should do with ESG in 2022. Should they move on now or would it not be better to put activities that might not provide direct financial gains on the back burner? In this article, we share our vision on this.
Wake-up calls for ESG-related topics
Markets and organisations do not float in a vacuum but are heavily intertwined with the world and all its natural limits and in a social context. This has never been different, but the corona pandemic, the Ukraine war and constant supply interruptions have made us even more aware of this reality. Specifically, the pandemic and its health risks for employees have forced companies worldwide to redesign their processes and accelerate their digital transformation. Similarly, the war is causing, among other things, an explosion in energy costs, the search for alternatives to Russian oil and gas, and the adoption of an ethical position about what is happening. All this shows that our markets, our economy and we must change and keep the big picture in mind because otherwise, we will hit a wall sooner or later. ESG is simply a prerequisite for long-term success for all of us.
Another issue that all non-capital-market-oriented larger companies (and the smaller companies they work with) will have to deal with is the Corporate Sustainability Reporting Directive (CSRD). From 2024 onwards, this new directive will require companies to report on the impact of their activities on people and the planet. Even if 2024 sounds a long way off, companies should start preparing now if they want to tackle the topic appropriately. And the CSRD is not only about reporting CO2 emissions and alike. It also requires companies to develop strategies and implementation plans to improve their environmental, social and governance performance.
What you can do now
It should be clear that we do not believe that companies and organisations should put their ESG transformation on the back burner. On the other hand, we also think you have to be realistic. If you don’t know if you can still deliver our product to your customers in wintertime, or meet all your payment obligations, this may not be the ideal time to make your entire production process climate neutral. However, even with limited resources available, often more is possible than you think, and it can also be financially attractive. For example, screening and reconsidering suppliers does not have to cost a lot and can even help you make your supply chain more resilient, save on (indirect) energy costs, and lower your CO2 footprint. Or mapping relevant data sources for your 2024 CSRD report now will be a lot less hassle (and save high costs for sustainability consultants and accountants when everyone needs them) than if you start at the end of next year.
ESG in 2022: much is possible in one day with the Empact Academy
Since 2006, we have been helping companies achieve their sustainability ambitions and successfully transform into a future-ready organisations. We do this now based on a systematic and proven approach. Since this year we also do this by interactive in-house workshops provided by the Empact Academy: in only one-day or half-day sessions, our experts will give you a structured overview and bring you up to speed on all relevant information on a specific ESG topic. The workshops are tailored to your company’s needs, so you can get to work immediately afterwards. In our view, the following ESG topics are the most relevant in 2022 for you:
- From ESG compliance to strategic ESG financial and societal value generation
- Getting ESG compliant
- Understanding and applying the OECD due diligence guidelines with a view to the upcoming Corporate Sustainability Due Diligence Directive
- Start your ESG procurement and supply chain journey
- Activate ESG in your procurement and supply chain
- Developing and executing a compelling ESG strategy
- Setting up an in-house ESG team
- Writing and publishing great annual ESG/CSR reports
Other topics are, of course, also possible – just ask. We are happy to help.