19. April 2023 By Tiia Katajamäki
Sustainability data roadmap would ease your ESG reporting pain
Early spring is the time when companies and organizations start publishing their annual sustainability reports. This annual data gathering usually requires a substantive amount of hours, sweat, tears and manual work which is not visible to the stakeholders reading the report. Data quality expectations will only increase as the existing EU legislation such as CSDR and Taxonomy are setting more binding requirements which concern whole value chains. How do companies navigate in this complex sea of sustainability data management?
Many companies might excel in their ambitious sustainability target setting, but still lack a comprehensive vision of how to collect and utilize data in their strategy implementation. Quite often data is collected from scattered systems with a broad network of stakeholders and partners, who do not share the same vision, resources nor common will to develop data gathering further.
At the same, companies do have the possibility and the obligation to accelerate sustainable transition in their industries. This will give them the mandate to drive data gathering for transparency, enhanced processes and new sustainable services and products in the forefront.
Sustainability data roadmap will guide the way moving from compliancy reporting to sustainability data creating added value for business.
What is a sustainability data roadmap?
Sustainability data roadmap is a comprehensive plan which defines how to collect, analyze and report the data. The roadmap outlines the various data points (such as GHG emissions, energy, water, waste and social metrics) as well as detailed plans how the company will align the main KPIs into decision making and utilize them in the long-term sustainability performance enhancement.
Company´s sustainability ambitions, targets and business needs define the actions in the sustainability data roadmap. The planning starts from scoping the project with core stakeholders. The definition of current stage of data collection maturity and the long-term sustainability data vision are needed to map the main milestones. The sustainability data vision should consider company’s own internal and external ecosystems including supply chain data and other external data sources.
Once the main KPIs and sub-targets are set, internal and external data sources should be identified, and data collection processes developed. This phase could include investigating new technologies or solutions, or then just enhancing the existing ones. The roadmap should consider the data quality controls as well as reporting mechanisms and frequency.
For example, embedding CO2 in financial reporting might enhance company´s forecasting, redirect actions more cost-efficiently and increase impact driven decision making.
Steps towards sustainability data driven business
Sustainability data roadmap is a crucial tool for companies that want to improve their sustainability performance. In addition to smoothing the reporting processes and enhancing the data quality, companies can provide more reliable and transparent data for decision making and external stakeholders, not to mention new business models around sustainability data.
Meaningful and analyzed data is required to drive sustainability strategy into action. As data and sustainability maturity go hand in hand, each organization should plan their actions according to their journey phase. Sustainability data roadmap is highly interlinked with organisation’s own resourcing, technical capability, and ambition to utilize data in their decision making. At best, sustainability data is a driver for business and various stakeholders are being engaged along the process.
Creating a sustainability data roadmap can be a complex task and the resources available in-house are limited. Sustainability data roadmap requires understanding of strategy, technology and sustainability data management challenges and opportunities in practice. Nevertheless, it is a critical effort for companies who are serious about sustainability and want to turn sustainability efforts into concrete business value.