By: R Mukund, Founder & CEO of Benchmark Digital Partners LLC

Today’s business leaders know that their company’s success depends as much on how it manages its Environmental, Social, and Governance (ESG) risks as it does on its financial performance. Enterprise revenue, operating costs, liabilities, equity, financial risk, and other established dollars and cents indicators no longer tell the whole story.

Investors want their portfolio companies to demonstrate that they’re taking steps to limit not only their contributions to climate change, but their exposures to its adverse effects. Employees and customers prefer to engage and transact with companies that credibly reflect their values. And regulators like the U.S. Securities and Exchange Commission (SEC) are proving determined to compel companies to regularly provide their stakeholders with standardized, decision-useful reports of their sustainability risks, their plans for managing them, and the resulting financial implications.

The declaration, pursuit, and proven achievement of bold enterprise ESG performance goals is no longer a “nice to have.” It’s an imperative.

As the findings from the 2022 Benchmark ESG Survey: Business Leaders’ Impressions of Their Enterprise ESG Programs suggest, this much is not lost on US-based business leaders. Among more than 500 respondents representing both privately owned and publicly traded companies across a range of industries, 97% reported that their companies have either already implemented an enterprise ESG program, or are in the process of doing so.

The trouble, though, is that the respondents to this latest Benchmark-commissioned survey, conducted by ClearPath Strategies, gave reason to believe that they are developing, implementing, and operationalizing their enterprise ESG programs to serve near-term, even short-sighted objectives.

By the same token, their ESG data collection, performance measurement, and reporting processes may fail to yield either the extent or quality of insights needed to drive continuous, financially expedient ESG performance outcomes and, instead, are incurring unnecessary risks and opportunity costs.

But, as detailed in a new Benchmark analysis of these survey findings, there are two keys to cultivating the lucrative, durable, and otherwise self-sustaining advantages of an enterprise ESG program: improved inter-stakeholder communications and more efficient and actionable enterprise ESG data management and reporting processes. The path toward securing both runs through digital transformation.

Benchmark’s analysis considers the discrepancies in the responses given across two pairs of subgroups in the survey sample.

The first of these subgroup pairs concerns seniority and speaks to an apparent intra-organizational disconnect between those evidently leading the charge for ESG performance excellence—senior leadership—and the more junior employees who are likely doing much of the legwork.

The groups differ in their expectations of where the ROI of their ESG initiatives will manifest, their confidence in meeting the SEC’s proposed corporate climate risk disclosure rule, and their satisfaction with the functionality of their systems for ESG data management and reporting.

The second of these subgroup pairs concerns survey respondents who reported using ESG data management and reporting systems developed in-house, and those who reported using a system purchased from a vendor.

Those using a vendor indicated they were taking a more balanced, data-driven approach to their ESG programs and were more satisfied with the functionality of their ESG data management and reporting systems. They also reported greater confidence in their organizations’ abilities to measure their operational greenhouse gas emissions and comply with the SEC’s imminent rulemaking.

For a complete analysis of the findings from Benchmark’s latest survey, as well as the instructive takeaways they offer business leaders, download Benchmark’s new eBook—Business Leaders’ Impressions of Their Enterprise ESG Programshere.

About the author:

R Mukund is Founder & CEO of Benchmark Digital Partners LLC (renamed from Gensuite LLC on 1-Jan-2021) and a proven organizational leader with nearly 30 years of experience in progressive roles as a technical professional, team leader, Six Sigma Master Black Belt, executive program manager, and most recently, chief executive officer since 2010. He has a track record of distinction in diverse organizations from research & technology, consulting, corporate diversified & global, and cloud-based, tech-enabled services.

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