Enel X’s tips on creating a sustainable energy strategy: Part 3March 26, 2020 REDWIRE is news you can use from leading suppliers. Powered by FRASERS.
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In this four-part article, Enel X North America, Inc. offers its expert advice for organizations on how to make the business case for a sustainable energy strategy, align stakeholders, and set actionable emissions targets. This third part deals with mandatory and voluntary reporting, plus internal and external engagement. Read Part 1 and Part 2.
Mandatory and voluntary reporting
Transparency is key to disclosing your organization’s progress and success. There are several disclosure frameworks that help organizations engage with internal and external stakeholders. These frameworks range from broad domains to commodity-specific metrics:
- Broad Disclosure. The GRI Sustainability Reporting Standards outline best practices for reporting publicly on a range of economic, environmental and social impacts. For example, to be compliant with GRI standards, companies must report total fuel consumption from non-renewable sources.
- Financial Disclosure. The Sustainability Account Standards Board (SASB) sets a standard for disclosing the financial impacts of sustainability to an organization based on the material ESG aspects of their sector. SASB helps investors evaluate the long-term financial value of an organization’s sustainability efforts. Adopting SASB standards can help organizations raise capital from ESG investors.
- Specific Disclosure. Companies that want to show progress against specific targets can disclose to commodity-specific frameworks. CDP outlines methodologies for reporting GHG emissions, water usage, supply chain emissions, and deforestation risks—giving companies an outlet to report progress on reducing their carbon footprints.
Some benchmarks—such as the Global Real Estate Sustainability Benchmark (GRESB) and ENERGY STAR—offer sector-specific disclosure methodologies. Depending on the sector in which your business operates, this may affect how and what you report.
Navigating the landscape of energy and sustainability tracking and disclosure is challenging and evolving. No single reporting framework is perfect for every business, and selecting appropriate frameworks will ensure you are positioned for long-term success.
Internal and external engagement
No matter how much effort and planning go into an energy sustainability strategy, it can’t be successful without firm commitment from stakeholders both inside and outside of a company.
Show investors you care.
Greener business is now an economic concern, not just an environmental one. Harvard Business Review (HBR) surveyed 70 senior executives at 43 global institutional investing firms, and found that environmental, social and governance (ESG) issues were “almost universally top-of-mind for these executives.” The Ceres Investor Network on Climate Risk and Sustainability is one example of the power of environmentalism in investing. Launched in 2003, it represents 160 institutional investors and over $25 trillion in assets under management, and its members are encouraged to engage directly with companies to “improve corporate strategies on environmental, social and governance issues.” Make sure your investors support your sustainability plans and realize the positive value it will add moving forward.
Take action within your supply chain.
To maximize the effect of any changes you make to the supply chain, you’ll need to consider the possible scope for improvement against the significance of any supplier, as well as possible leverage you would have over the given supplier or market. If your company has little leverage, ambitious sustainability requirements could lead to significant price increases. Focus your efforts on changes that keep your strategic vision and business goals aligned.
Ensure your employees feel connected to your goals.
Sustainability commitments can also play an important role in attracting and retaining key talent, as Cone Communications found that “64 per cent of Millennials consider a company’s social and environmental commitments when deciding where to work.” Make sure you communicate with employees at all levels about what they can do to contribute toward your goals, and ensure that HR emphasizes to potential employees your company’s energy sustainability in order to attract the best talent possible.
To learn more from Enel X about how to create a sustainable energy-strategy program, click here.
For more information, contact Enel X.