ESG Strategy for Business Development

There are many variables that determine this. The scope to be covered by the strategy, the availability of data to be addressed by critical metrics, the maturity of the organization in terms of development plans, the involvement of key people — all of which are of paramount importance. We estimate that it takes 6 to 9 months to develop an ESG strategy.

First of all, it is necessary to specify in detail which ESG areas the strategy is intended to address. A good solution is to refer to the double materiality analysis, which defines the scope of non-financial reporting. The sustainability report is also very helpful, which provides knowledge of the starting state. For the decarbonization part, an analysis of the company's carbon footprint (preferably in three ranges) and an energy efficiency audit are necessary. Likewise, the taxonomic disclosure, including its analytical part and activities that do not meet the sustainability criteria.

Basically, there should be a single document that will integrate environmental, social and corporate governance factors into methodical business management. If ESG is to bring economic benefits, it must be present in production, services and management processes, that is, areas where the company earns, invests and incurs costs. Otherwise, ESG will be an insignificant addition to the daily activities of the company.

If a company is regulated, is guided by counterparty expectations, intends to enter into partnerships with advanced sustainability entities or seeks sustainable financing, it should invest in an ESG strategy. A good opportunity is to enter the reporting obligation under the CSRD Directive.