Let these four words live and breathe together.
“From complexity comes stress, anxiety and frustration – even rage – followed by apathy and exit. But you do not have to be a victim any more.”
Edward de Bono, Philosopher
Companies are increasingly looking at planning their Sustainability Reporting to comply with SGX Sustainability Reporting Guidelines. Many are integrating sustainability risk management into the business.
Such work, coupled with the process of preparing a Report, can help meet investor analysts’ needs, showcase the forward looking approach of management and improve access to finance. The work you put in will also help preserve your license to operate, save costs, attract and retain talent, create innovation and lead to new markets. A bunch of companies recently shared their views on this at a free Paia breakfast briefing.
But what if your customers and investors are expecting a response to sustainability and you don’t have one?
You need to get started.
- First, list who your stakeholders are. These are people and groups who, (i) are affected by your organisation, and (ii) who affect you. Decide how you wish to engage with them, if you’re not already (eg customers and suppliers will likely be sharing views on certain issues already).
- Then list ESG issues – Environmental, Social and Governance risks and opportunities. Keep it a deliberately long list. Even if your business is a holdings company for example there will be ESG issues to consider.
- Then, with the help of a small specialist advisory firm, use a couple of processes and techniques to filter out what matters; and then develop a sustainability report on it.
Wider sustainability risks may be new to your commercial and governance teams. If so, a credible approach to dealing with them is to understand what matters, and to whom. There are hundreds of risks, many with perhaps only marginal relevance to you. A credible approach uses tried and tested techniques (eg, materiality). The stakeholder list is used in such work.
“Credible” need not mean complex. Having seen various approaches to sustainability management and reporting over the last 20 years, we at Paia want companies to embrace sustainability as part of doing business, but in a straight forward manner. “Simple” means clarity, understanding, engagement. Depth and reach can come later. And government, regulatory, investment and other institutional stakeholders encourage baby-steps first, to encourage uptake.
To make sure life remains simple you will need to plan. So, as we said in June, you will benefit from an early start on tasks such as issues prioritisation, resourcing, policy development, content management, design etc. As I write it’s September: this is ‘Kick-off’ month for most. Don’t leave it to the 11th hour!
Some of you may be wary of targets and how to use them in sustainability management practice. If, for example, you’re listed on SGX then take heart: SGX rules allow targets to be qualitative. So that allows for simplicity. At first. As part of a phased approach to corporate sustainability programmes and reporting you’d be wise to talk with your stakeholders on what targets and KPIs would be appropriate. Paia is experienced in this.
Keep it simple, feasible, manageable. Plan it, lay the foundations, set targets, ensure an efficient project, make sure the output is credible and benefits your business.