From Compliance to Impact – what is the direction of ESG today?

My key takeaways from the United Nations Global Compact Network Conference.

Last week, I attended the UN Global Compact ESG Network Event – a fascinating look at where Environmental, Social and Governance (ESG) agenda is heading and how business can ensure that compliance reporting doesn’t take precedence over real impact.

The main theme of the day was clear: a strong collective desire for the focus of ESG to shift from compliance to impact.

Speakers expressed their frustration that ESG reporting too often becomes a tick-box exercise, with complex and conflicting customer demands, as well as overly rigid regulation, becoming counterproductive and detracting from companies' ability to focus on impact. Progress over perfection’ is what is needed rather than just complying with a set of policies. Scalable, achievable ESG initiatives can have far more impact than perfect disclosures.

Unsurprisingly, the organisations that thrive in the long-term are also those that prioritise strong, trusted partnerships and long-term value over short-term metrics. I hope ESG will continue to move towards prioritising stakeholder relationships, long-term impact, and culture change as the real measures of success.

Despite today’s challenging political landscape, which risks undermining ambitious climate and sustainability goals, corporate climate action continues undeterred. While it can be difficult for organisations to remain ambitious when broader policy frameworks aren’t keeping pace, many businesses are pressing on because they recognise the strong business case for a robust ESG strategy – as a driver of innovation, competitive advantage, risk management and stakeholder trust.

I shared some of my findings with our Chief Sustainability Officer, Tim Rotheray who said:

“ESG has to make a difference. If it is just reports and box ticking it's a real waste of time and resource. Viridor has to have a relentless focus on what makes change, reduces business risk, drives commercial opportunity and makes sure we have a truly sustainable business for the long term by caring for both people and planet.”

People felt collaboration between businesses is really important, especially in emissions arising in the supply chain. By rallying around shared challenges, the private sector can drive the climate agenda even when political momentum stalls.

Supply chains were highlighted as one of these key areas of opportunity for ESG impact.

Edita, our ESG Director, currently leading the development of Viridor’s ESG strategy for the next three years said:

"The inherent importance of collaboration to deliver impact through the ESG initiatives was expressed across all our stakeholder groups when consulted as part of our comprehensive Double Materiality Assessment (DMA). The results of our DMA are clearly and rightly steering us to continue to focus on collaboration with supply chain, communities, customers and others to deliver real long-lasting impact."

Another highlight was the exploration of the business case for Diversity, Equity and Inclusion – simply put, this means that everyone should have the opportunity to be the best version of themselves at work no matter their background. DEI shouldn’t sit in a silo; it’s everyone’s responsibility. I enjoyed hearing how organisations are trialling creative incentives that highlight how ESG can boost wellbeing, such as offering five extra minutes of holiday per day for commuting by green transport. It was also inspiring to learn how AI tools are being used to support neurodiverse talent and help colleagues returning from parental leave get up to speed more quickly.

However, Anthony Levy from Circularity First reminded us that IT and digital systems are also one of the fastest growing emissions sources. Simple actions, such as automating system shutdowns overnight or choosing remanufactured IT equipment, can cut its energy usage by half and go a long way to reducing our supply chain (Scope 3) emissions.

It reminded me of a great post shared by one of our Viridor colleagues, Lindsey Webb, who said, "until recently, I hadn’t thought about the fact that every email sent, stored, or left unread has a carbon footprint… multiply that by the thousands of emails we all get, and it quickly adds up".

Making small digital changes does add up, and I reflected on the fact that sustainability isn’t just about trucks and turbines, it is also about the individual decisions and actions you and I take in our day-to-day work.

Thank you for reading, I’m now off to explore my local cycling routes, switch to remanufactured tech, and finally make use of those energy-saver modes on my devices – a small step to cutting my own carbon footprint!

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