Discussion focused on potential implications of U.S. SEC’s proposed climate rules, execution of demonstrated tactics for value chain climate risk mitigation, and present and future roles of digital technologies in helping companies manage and report their ESG performance
CINCINNATI–(BUSINESS WIRE)–Benchmark Digital (Benchmark), a leading provider of cloud-based Environmental, Social and Governance (ESG) software solutions, last week convened its fourth ESG Executive Collaboration Forum. Guests shared insights on the practical impacts of the U.S. SEC’s proposed corporate climate risk disclosure rules on industry, the steps organizations can take now to prepare for potential new direct reporting obligations; and they shared their outlooks for the roles emerging technology will play in advancing corporate sustainability performance management and reporting.
“The calculus has changed considerably. We’re now looking at the entire value chain which requires engaging supply chain actors, suppliers and upstream manufacturers, at a whole new level.”
Dr. Haman began the session by delving into the actions business leaders can take to best prepare to comply with the Scope 3 emissions provisions of the SEC’s proposed rules, from demonstrated stakeholder engagement tactics to their corresponding monitoring and reinforcement methods.
“Companies can mitigate risks in their value chain, whether it be upstream or downstream, and unlock new collaboration and innovation through partner engagement, communication, support, monitoring, and ultimately reinforcement,” said Dr. Haman. “[And] numerous business goals can be served by creating and managing a Scope 3 [emissions] inventory. For example, companies can reduce their upstream energy costs by engaging their suppliers’ in emissions management and reporting through a supplier ‘code of conduct’ and reinforcing that behavior via subsequent contract procurement processes.”
Even with these approaches, the tasks of producing and reporting investment-grade Scope 3 emissions data require significant resources from companies. But, just as expectations for companies to consider their sustainability performance across their full value chains have grown, so too has the functional sophistication of enterprise ESG software.
“We need to move beyond seeing ESG reporting requirements as a data gathering exercise. Instead, we must view it through the lense of year-over-year performance and use ESG data for continuous improvement. That takes a culture change and realizing that ESG compliance is everyone’s responsibility” said Hornsby during his Q&A with Ramanujam. “The calculus has changed considerably. We’re now looking at the entire value chain which requires engaging supply chain actors, suppliers and upstream manufacturers, at a whole new level.”
Ramanujam and Hornsby agreed that companies’ sustainability performance management and data disclosure needs are not only dynamic, but increasingly complex. Considering this, Ramanujam discussed how blockchain technologies can strengthen the contemporaneity, integrity, and traceability of companies’ value chain ESG data.
“We live in a decentralized world with many standards, guidelines and softwares. We need to be smart about integrating and harmonizing and must reflect the decentralized nature of climate action. How do we meet people where they are and give them a technical architecture that allows them to capture, verify, and validate data therefore creating a higher level of confidence for those making investment grade decisions. We need to track, trace and validate where the action is actually happening. I see blockchain as a critical technology that is coming into play.”
A recording of Benchmark’s fourth ESG Executive Collaboration Forum is available here. Additional expert commentary on these matters will be featured in forthcoming sessions of Benchmark’s ESG Executive Collaboration Forum series and within the Benchmark moderated ESG Executive Collaboration Forum LinkedIn group, which interested parties are encouraged to join. You can also read more about Benchmark Digital’s inaugural survey on investor attitudes towards ESG data and download the new eBook outlining survey findings.
Interested in continuing the conversation? Join us at our 2022 Benchmark ESG Conference on Sustainability, ESG and Operational Compliance from May 10-12 in Orlando, FL. Register and preview the agenda here.
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