For Sustainability consultancies that have chosen to make a digital reporting solution part of their arsenal of tools, the immediate question is with whom to partner. A robust vetting process is important for sustainability consultants to ensure they are partnering with the right technology solutions provider.
§ Does the solution recommend ESG topics and host the Reporting frameworks relevant to your client?
§ Is the ESG reporting solution certified by the recognized framework providers, GRI and SASB?
§ Does the ESG reporting platform treating your client’s data with the highest standards of client security? Does the technology solution deliver end to end sustainability reporting guidance and facilitate the process, or rather offer a generic template?
§ Does the reporting solution allow for uploading of evidentiary documentation and offer a blockchain audit trail for review of the actions associated with data inputs? Can the report outport be used for external data assurance processes?
§ How user-friendly is the tool and is your firm being given the right customer support when operating the solution?
§ Is the licensing price point in alignment with what your clients can afford and allow your sustainability consultancy to operate a scalable and profitable business model? Is there a set up fee?
§ Does the solution facilitate a workflow process for the collection of data, eg allow for multiple accounts to be created to work with the Sustainability consultant in a collaborative way?
§ Is the partner offering support services (eg technical support) post sale and on an ongoing basis?
§ Does the technology solutions provider have an internal sustainability team that stands ready to respond to any sustainability content specific questions?
We recommend diginexESG in order to support your clients the best way
Guiding questions for effectively engaging your clients on a tech - enabled ESG consultancy project.
1. Kick - off meeting
§ What are the reporting motivations of your client’s management team?
§ Has your client’s senior leadership team given an explicit ESG reporting mandate?
§ Has your client ever done a sustainability report before?
§ Is the client familiar with the reporting frameworks? Has done a materiality assessment? Has an ESG reporting plan already in place?
§ Has your client an ESG team or someone who is supposed to take care of ESG issues including reporting?
§ Did your client ever used or currently using a digital reporting platform?
TIP: In the event that your client is using a digital reporting platform it is important to understand the main motivational driver and strategy, the suitability of the solution to address the challenges and how the use of the platform fits into the delivery of your assignment. Should the client have no experience in using technology, your firm should suggest a suitable provider and build time for capability building and training into the project plan delivery.
2. Material topics and Strategy
§ In which industry context does your client operate and what does best practice reporting for this industry look like?
§ What are the most material topics for your client and its stakeholders?
§ How can ESG integrate with the company’s business strategies?
§ What are the opportunities and risk emerging impacting your clients financial and business operations?
§ How does your client’s economic activity impact ESG topics of its environment?
§ How can your client proactively seek opportunities for sustainable value creation and make it an integral part of its business operations?
TIP: Our digital reporting solution diginexESG’s materiality engine helps companies and their consultants to easily identify material topics based on framework and stakeholder recommendations. They also allow you to perform a stakeholder assessment using the platform to prioritize material topics. The alignment of ESG topics from both an internal as well as external stakeholder perspectives is one of the most important activities for a sustainability consultant.
3. ESG Reporting Framework and Metrics
§ In which regional/ country / industry context does your client’s company operate and what are the current and upcoming regulations (Consider EU taxonomy, regulatory ESG and Climate specific reporting requirements?)
§ Does your client wish to report against multiple Standards and Reporting frameworks, and can those be cross mapped? (Consider GRI, SASB, TCFD, industry specific and exchange specific reporting frameworks)
§ What are the specific metrics and KPIs your client wishes to track to identify areas where change is needed?
TIP: The right technology solutions can ease the process of not only identifying how ESG topics link to the metrics, but also review all the reporting guidance, units and metrics, offered by the relevant framework provider, in digital format hence saving tremendous time and effort in the review and interpretation of the reporting guidance.
4. ESG Data Collection and Aggregation
§ Is the data and supporting documentation available and where are the data gaps? Has the company experience in collecting climate and energy specific data?
§ With which department does the data sit and is the data collection process manual (excel files, email) or automated?
§ Who is responsible and accountable for reporting the company data and are these individuals/departments clear on the data collection and aggregation process?
§ Is the client able to configure the ESG reporting framework and collect the data in a tech-enabled way? If not, what type of support are needed for operating the digital ESG reporting platform.
TIP: It’s important to spend time building capacity and training the use of the digital reporting solution. All departments should be clear on the application of the technology solution, timelines for data collection and reporting guidance, such as the standardized set of units and metrics.
5. Data Validation
§ Who signs off on the ESG data and the report?
§ Does your client wish to obtain independent third-party assurance?
TIP: At the end, or during the data collection process, it is essential to validate the information collected by either internal senior stakeholder and/or internal stakeholders. The best ESG reporting solutions have data validation build into the process and consultants can perform the activity without engaging in an “off-line” service. Some clients might want to pursue independent third-party assurance and include assurance statements into their sustainability report.
6. Publish investor-grade Report
§ How does your client plan to publish the report, as a standalone sustainability report, or integrated into an Annual Report?
§ Does your client need support in making the data and metrics readily available for, directors, business partners, employees, and other key stakeholders?
§ Does your client need support with the narrative, case studies and content index creation?
§ Does your client wish to set KPIs and setting (science-based) targets and support in defining action plans?
TIP: Beyond the data collection, it’s the consultant’s responsibility to ensure the information stated is accurate and reflects the vision and values of the client. Beyond the data states, the consultant should also pay attention to contextualize the information by showing both historical trends and specify actions the client is taken to meet set targets.
“The future of leading Sustainability and ESG consultancy services is tech-enabled, data driven, with face-to-face time spend on provision on strategic guidance and capacity building”.
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