It’s not just CSRD making waves in the world of environmental, social, and governance disclosures. Regulations for sustainability and reporting requirements are in a constant state of flux, and keeping up with these changes can seem like a daunting task.
Alex Hardwick is Cority’s Director of Sustainability Planning and Enablement and has more than 15 years of experience in sustainability, with a background in life cycle assessment and carbon foot printing. We caught up with him to get some insight into steps organizations can take to future proof their reporting.
Do you have any advice for staying up to date with regulatory changes?
Hardwick: Don’t leave it to one person in the organization, build a trusted network. Get a team of people who attend training and get their own certifications to become subject matter experts – then you have people with links to professional and industry bodies that will also help to pick up changes that one person might miss.
How can companies stay ahead of these revisions and prepare for future compliance requirements?
Hardwick: When a change is coming, gather information early.
1. Identify if you will be affected – many regulations and standards are targeted at organizations meeting certain criteria be it size or emission volume or industry type.
2. Engage with it; don’t try to ignore it – read the drafts, provide comments and be constructive even if you’re concerned about certain requirements.
3. Plan ahead – will you need new tools, new data, new policies? These things always take longer than you think and usually require engagement from multiple departments, so get it on people’s radar early.
Companies must also effectively integrate regulatory change management into their business strategy to ensure long-term growth. Any advice for how to manage those considerations?
Hardwick: Begin by planning the resources appropriately. In my view, the best way to consider it is risk management – inability to deal with regulatory change in any area is a strategic risk as it can impact license to operate, inward investment, winning new business, staff retention and much more.
Communicate both the benefits of doing it, but also the risks of leaving it late or not doing it. This can help to ensure that appropriate resources are allocated to managing changes.
What methods can companies use to balance the need for compliance with their business goals?
Hardwick: Identify the benefits in the work you’re doing in terms of the data that’s being gathered, insights that emerge or efficiencies that can be found. Often there’s such a clamor to get the reporting done that no effort is put into “what else could we use this for” or “what does this mean”.
Going through that exercise often helps to identify alignment with the business’ broader objectives and can be important in communicating the benefits to other stakeholders whose help the sustainability team needs. When those benefits are identified communicate them widely!
Keeping up with regulatory changes isn’t the only task for sustainability reporting. Data collection, management, and validation are all vital, too. That’s where Cority’s industry-leading software can be a game changer.
We asked Principal Consultant Karina Alventosa and Professional Services Manager Jake Yeoell about how our Sustainability Cloud software can make reporting – and planning for the future – easier. They’ve been working in the sustainability sector for more than a decade, providing users with advisory services to help them reach their ESG goals.
What are some advantages of using Cority software to manage sustainability reporting and goal tracking?
Alventosa: Data storage in a software program provides a centralized, single source of truth and shifts data collection away from cluttered or frenzied emails and spreadsheets into streamlined workflows.
Yeoell: Software is much more efficient than traditional or offline data management methods and allows for automated workflows.
Alventosa: It also means that data collection can be disaggregated, allowing for users across the organization to contribute high quality data with better alignment and minimized risk of error.
Yeoell: This often leads to more engagement with data stakeholders, as they can be more involved in the data acquisition process through the flexibility of software’s insights.
Yeoell: Cority’s centralized library of more than one million emissions factors also reduces the burden on a those responsible for ESG data. It also allows for complete coverage of all sustainability and ESG activities in one place.
It’s always rewarding to see clients move from just reporting to actually managing performance, and then focusing on reductions and wider initiatives following implementation of Cority’s Sustainability Cloud.
Could you provide some guidance on best practices collecting data and ensuring data quality across the company and its value chain?
Yeoell: Cority’s clients are increasingly automating the acquisition of complex sustainability data, thus increasing efficiency and reducing risk of human error.
Alventosa: Engaging with stakeholders that are enthusiastic about data collection and ESG is important.
Yeoell: This increases engagement and leads to more accurate and timely provision of data. Stakeholder reputation and your score or rating with various frameworks and agencies, like CSRD or CDP, could also show improvement.
Alventosa: Having a data quality improvement strategy in place helps develop holistic view of the data quality of the organization as a whole, particularly if you can define and map your sources of sustainability data.
Yeoell: For example, using Cority’s approvals and variance tracker functions means you can assess data categories and sources for automation opportunities and implement an internal verification system.
Are there things you recommend doing yearly, monthly, or weekly to keep track of the necessary data?
Alventosa: I recommend a monthly data collection to prevent the annual end of year scramble. More frequent touch points also help keep people engaged in the process and allows for more feedback.
Yeoell: Generally, the more frequent the better. Monthly data collection has a host of benefits, like identifying and addressing issues early on.
Regular engagement and data collection frequencies also avoids the ‘end-of-year reporting rush’. It’s been shown to increase accuracy of data and provides you with the ability to analyze performance against reduction goals throughout the year.
Alventosa: Annually, end-user training is also great for keeping up to date on the organization’s current ESG status. If these users aren’t aware of initiatives and company values, they may be less inclined to contribute data. This has the added benefit of providing transparency for the work being done.
Yeoell: Even external verification, which is generally an annual process, is often being done twice a year now. Regular data validation and sign-off process throughout the reporting year is important.
Do you have any thoughts on what constitutes an effective data management plan to ensure it aligns with overall business goals?
Yeoell: Sustainability data management plans are essential resources for describing, informing and maintaining a robust data collection and calculation process. For corporate GHG emissions accounting, Inventory Management Plans have become established governance documents which cover important aspects of the data management process.
By defining and implementing a comprehensive Inventory Management Plan, organizations can ensure that a robust management and governance process is being followed at all stages, leading to more complete and accurate data for reporting.
With Inventory Management Plans established for GHG accounting, it is also important for organizations to take a similar approach with all areas of sustainability data, ensuring coverage of social and governance metrics.
Cority has more than 70 experts working behind the scenes to ensure our Sustainability Cloud remains a leader in its class, but don’t just take our word for it. We’ve got more than 600 customers around the globe using Cority to plan for, track and achieve their ESG goals. Could your organization be next?
