INTHEBLACK December 2023/January 2024 Special Edition - Flipbook - Page 41
PURPOSEFUL
NUMBERS
With a growing need to disclose the environmental,
social and governance impact of their work,
dedicated software can help businesses to
track and manage a range of metrics.
WORDS ROSALYN PAGE
W
ith increased scrutiny
from shareholders,
regulators and customers,
environmental, social and
governance (ESG) reporting is growing
in importance.
Many financial and accounting businesses
are looking to software solutions to help
track and report against a variety of targets, to
manage risks and improve performance.
When developing an ESG approach
to prepare for the use of ESG software,
Fiona Hancock, partner climate change and
sustainability services at EY Oceania, says
clarity is important. Identify ambitions, specific
targets and the plan to meet these commitments,
she says.
Where there are issues not being addressed or
commitments not being met, Hancock recommends
“being transparent around how the organisation intends
to get from where it is to that target in the future”.
PRIORITISE FOR IMPACT
ESG reporting provides transparency to stakeholders
about how the business is minimising negative
impacts and enhancing positive benefits.
“The first place to start is with the materiality
of issues and focusing on those that are most
material, or relevant, to the organisation,”
says Hancock.
The materiality assessment identifies the ESG
risks for the business and ranks them in order of
impact. ESG goals are then developed, based
on the approach taken to address these risks.
With climate change, for instance, this means
setting emissions reduction targets.
“It’s important to understand how to get to those
targets that are meaningful. With environmental,
for example, it’s avoiding risking going into
‘greenwashing’ territory,” she says.
WHAT ARE ESG REPORTING TOOLS?
ESG software is used to track specific standards,
validate and report on data, and achieve a
suitable level of governance in non-financial
performance metrics.
This includes carbon emissions, product safety,
supply chain assessment, diversity and inclusion,
executive compensation and separation of powers.
No single tool on the market today can address
all ESG issues, according to Gartner.
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