Sustainable Trade
Sustainable Trade
Trade and ESG reporting
Trade and ESG reporting
Trade plays a significant role in ESG (Environmental, Social, and Governance):
Environmental Impact
- Supply Chain metrics: Transactions involving suppliers and logistics can affect a company’s emissions, resource usage, and waste management.
- Sustainable Procurement: Purchasing that prioritize eco-friendly products and services contribute to a company’s environmental goals, is often highlighted in ESG reports.
Social Impact
- Labor: transactions with suppliers and contractors can influence labor conditions which companies report in their fair labor practices.
- Communities: especially in local communities such as sourcing from local suppliers which enhances social impact and is often included in ESG disclosures.
Governance
- Ethics: ensuring that transactions are conducted with transparency and integrity, including compliance with legal commitments and timely payment obligations.
- Risk : trade management can help mitigate risks, such as financial, operational, and reputational risks
Companies are expected to disclose their commercial transactions’ impact on ESG factors
Trade plays a significant role in ESG (Environmental, Social, and Governance):
Environmental Impact
- Supply Chain metrics: Transactions involving suppliers and logistics can affect a company’s emissions, resource usage, and waste management.
- Sustainable Procurement: Purchasing that prioritize eco-friendly products and services contribute to a company’s environmental goals, is often highlighted in ESG reports.
Social Impact
- Labor: transactions with suppliers and contractors can influence labor conditions which companies report in their fair labor practices.
- Communities: especially in local communities such as sourcing from local suppliers which enhances social impact and is often included in ESG disclosures.
Governance
- Ethics: ensuring that transactions are conducted with transparency and integrity, including compliance with legal commitments and timely payment obligations.
- Risk : trade management can help mitigate risks, such as financial, operational, and reputational risks
Trade & United Nations Sustainable Development Goals (SDGs)
Trade & United Nations Sustainable Development Goals (SDGs)
Trade contributes to four Sustainable Development Goals (SDGs) defined by the U.N:
Trade contributes to four Sustainable Development Goals (SDGs) defined by the U.N:
Trade & the United Nations Sustainable Development Goals (SDGs)
Trade contributes to four Sustainable Development Goals (SDGs) defined by the U.N:
Trade contributes to four Sustainable Development Goals (SDGs) defined by the U.N:
ESG Reporting Challenges
ESG Reporting Challenges
ESG reporting comes with many challenges:
1. Multiple Reporting Frameworks
There are various ESG reporting frameworks (e.g., GRI, SASB, TCFD), each with different requirements and metrics; which framework to follow and how to align?.
2. Complex Regulations
ESG regulations are evolving and vary across regions: how to comply and keep up?
3. Data Management
Collecting, managing, and analyzing ESG data is complex. Many organizations struggle with integrating data from various sources and ensuring its accuracy and completeness.
4. Defining and Quantifying ESG Risks
Identifying and quantifying ESG risks can be difficult. Companies need to understand the potential impact of ESG factors on their operations and financial performance.
5. Understanding the Impact of ESG Initiatives
Measuring the impact of ESG initiatives is challenging & green washing exposes to fines
6. Stakeholder Expectations
Investors, customers, regulators, suppliers have varying expectations of ESG disclosures.
7. Comparability and Alignment
Ensuring that ESG disclosures are comparable across companies and aligned with global standards is crucial. This requires consistent and harmonized reporting practices.
8. Resource Constraints
Implementing comprehensive ESG reporting requires significant resources, including time, expertise, and financial investment, especially at end of reporting periods.
ESG Reporting Challenges
ESG Reporting Challenges
ESG reporting comes with many challenges:
1. Multiple Reporting Frameworks
There are various ESG reporting frameworks (e.g., GRI, SASB, TCFD), each with different requirements and metrics; which framework to follow and how to align?.
2. Complex Regulations
ESG regulations are evolving and vary across regions: how to comply and keep up?
3. Data Management
Collecting, managing, and analyzing ESG data is complex. Many organizations struggle with integrating data from various sources and ensuring its accuracy and completeness.
4. Defining and Quantifying ESG Risks
Identifying and quantifying ESG risks can be difficult. Companies need to understand the potential impact of ESG factors on their operations and financial performance.
5. Understanding the Impact of ESG Initiatives
Measuring the impact of ESG initiatives is challenging & green washing exposes to fines
6. Stakeholder Expectations
Investors, customers, regulators, suppliers have varying expectations of ESG disclosures.
7. Comparability and Alignment
Ensuring that ESG disclosures are comparable across companies and aligned with global standards is crucial. This requires consistent and harmonized reporting practices.
8. Resource Constraints
Implementing comprehensive ESG reporting requires significant resources, including time, expertise, and financial investment, especially at end of reporting periods.
Commercial Transactions and ESG reporting
Commercial Transactions and ESG reporting
Commercial transactions can play a pivotal role in addressing ESG reporting challenges by providing opportunities for better data management, compliance, and stakeholder engagement:
• Enhanced Data Collection
• Standardized & Automated Reporting
• Assured Compliance
• Contractual Obligations
• Transparency
• Collaborative: same truth & shared efforts
• Cost Efficiency
By leveraging data at commercial transactions level, companies can address many of the challenges associated with ESG reporting, leading to more economical and reliable disclosures.
No time for Survey?
"Prefer getting straight into action? Just complete the contact form and you can get started in 5 minutes! "
