Environmental, Social, Governance (ESG) reporting is quickly becoming an essential tool in demonstrating a businesses ability to thrive in the modern world while showing a commitment to global issues.
Nonetheless, to report effectively it is important to have solid data which can be clearly defined and measured. ESG data gathering templates which help to define the required data and assist with measuring the correct variables can therefore be invaluable.
Selecting the correct ESG data gathering templates can greatly assist in identifying the correct data to collect and measure. However, several factors must be considered prior to selecting a template:
- Materiality – Is the data gathered in a particular template material to your operations?
- Audience – who is the report targeted towards? Is the data being gathered appropriate for the audience?
- Competitor approach. What templates are your industry competitors using. This is especially important when investors are attempting to benchmark your business within its sector based on ESG reporting.
- Regulatory requirements – It is essential that as a minimum the measured data should enable an organisation to track data pertaining to any legal or regulatory targets or requirements.
It may be necessary to use multiple templates and frameworks and to monitor data from different sources. This way data can be analysed for bias and subjectivity can be acknowledged and accounted for. Then a more accurate unified data measurement can be taken.
If the above measures are not taken then you risk making business decisions based upon flawed, inaccurate, or irrelevant data. This can have serious consequences from a regulatory perspective and severe financial implications from a business strategy perspective.
ESG data gathering templates can help as a guide to navigate the minefield of successful data gathering, but they may not necessarily be a perfect fit for your organisation. It is therefore important to have a flexible approach and to always consider the particular ESG reporting requirements within your sector.