Many companies these days like to say they are green and working towards a sustainable future. While they may be trying to practice what they preach, companies going green often aren’t nearly as sustainable as they can be. A holistic approach is needed to ensure they are taking the proper measures that actually make a difference.
One of the best ways to do this is to implement an ESG system. This stands for Environmental, Social, and Governance and is a way to evaluate and develop goals to achieve a truly sustainable model. This takes a lot of criteria from different areas so you can see the true impact of your processes and determine what needs to change. In this article, we will go over the benefits of using ESG but to learn more about what it entails check out https://www.servicenow.com/products/risk-management/what-is-esg.html.
1 – Competitive advantage
Many consumers these days are concerned with ethical spending and would rather not spend money with companies that are not serious about their commitment to being good stewards of the planet. This means that they will gladly spend their money with a company that is using ESG to be more sustainable and responsible and will abandon a company that doesn’t.
To get a leg up on the competition, you will be able to build a brand that is recognized as being a leader among responsible companies. Since ESG can now be evaluated using software, it is easier to make the evaluations that matter and can set your course more wisely. In doing so, you will be in line with what your customer base is looking for.
2 – Reduces cost
One of the best ways to be sustainable is to reduce how many resources are used. The less electricity needed to light your offices or warehouses is going to reduce how many fossil fuels are used to produce the energy, for example. In the process, using less will result in significant money savings.
ESG is a system that makes it easier to monitor the metrics and understand where and how you can be using fewer resources. This software can help make processes more efficient and also uses less such as managing a fleet of trucks or dealing with waste.
3 – Attract investors
Investors are also looking to cash in on the trend of consumers that would rather spend their money with a green company. In fact, there are many mutual funds that won’t invest at all in companies that are tied to anything related to the fossil fuel industry or have low environmental ratings.
This means that if you are using ESG as a system to go green then you will surely attract the attention of people looking for companies to invest in. In fact, without this rating, it may actually be difficult to secure funding since it is a requirement for so many investors these days. Ignoring ESG could end up costing quite a bit of money.