Compare You Footprint and The Disruption House talk ESG at the Digital Accountancy Show
The Disruption House has partnered with Compare Your Footprint, offering organisations high quality carbon calculation software and expertise. We are jointly participating at the Digital Accountancy Show on 15th June 2023 where we will talk to accountants about the benefits of offering ESG as a service to their clients.
In an ever-evolving digital era, businesses must focus on long term sustainability objectives in order to remain competitive. Investors are seeking evidence of corporate social responsibility, whilst customers and employees demand transparency – placing emphasis on accountability for non-financial performance. Accountants can help bridge this gap through leveraging their expertise in analysis, reporting and independent advice; providing the required insight into sustainable development strategies so organisations stay ahead of the game. But where do accountants begin?
In the wake of the global pandemic, many businesses are looking to take a more sustainability-minded approach to their operations. For accounting firms, this means exploring Environmental, Social, and Governance (ESG). ESG is a set of principles and measures used by organizations to assess their overall impact on society and the environment. It can be an effective way for firms to make sure they are making responsible decisions that also benefit their bottom line.
Accountability & Transparency
One of the primary benefits of ESG is that it promotes accountability and transparency within an organization. By setting clear standards for measuring the impact of a company’s decisions on its employees, customers, community, and environment, it encourages companies to actively consider their long-term effects in terms of both financial and non-financial outcomes. This can help small accounting firms establish trust with clients and potential investors as well as create a positive reputation in the industry.
Risk Management & Opportunity Identification
Another advantage of adopting ESG practices is that it helps small accounting firms better advise their clients and manage risks in their businesses by identifying opportunities for improvement. By tracking their clients’ performance against established benchmarks related to environmental impacts, social responsibility initiatives, or governance structures, accounting firms can gain insight into areas where their clients could improve operations or increase revenue streams. This information can help them develop strategies to reduce costs while simultaneously driving innovation within the business.
Finally, embracing ESG practices can result in cost savings over time. By committing to sustainable operations such as reducing energy use or investing in renewable energy sources like solar panels or wind turbines, accounting firms’ clients can save money on utility bills while also contributing positively towards environmental conservation efforts. Additionally, by setting up systems that track employee productivity such as workflows or task management tools, companies can optimize internal processes which leads to increased efficiency and cost savings down the line.
By integrating ESG issues into their strategies, companies can reap tremendous rewards. From lowered credit default risks and more favourable loan terms for SMEs to notable cost savings, improved efficiency, and reduced employee turnover – the perks are impressive! Better run businesses are a better credit risk for their lenders, leading to increased access to funding makes it better than ever before for enterprises that prioritize ESG in their practices to accelerate growth.
Rabobank and Bain report found that clients with low ESG performance were about twice as likely to be in arrears as the high ESG performers, all other factors being equal, demonstrating that stronger performance on ESG dimensions correlates with lower credit risk.
With the UK having no single ESG regulation as of present, its current framework draws from both domestic and EU legislation to create an advanced ecosystem which encourages businesses to adhere to essential environmental, social and governance standards. Starting in 2023, ESG reporting in the UK will be further formalised through the Sustainability Disclosure Requirements (SDRs).
It is estimated that SMEs and mid-sized companies collectively contribute up to 70% of global pollution. Especially manufacturing SMEs are reported to account for 64% of air pollution, whereas only 0.4% of these SMEs comply with an environmental management system.
How can we help you?
Compare Your Footprint and The Disruption House have a powerful digital diagnostic tool that can help uncover your current Environmental, Social and Governance (ESG) health of your business or customers, while also giving insight into how to lay out an action plan for improvement. Click here to access our free 5-minute survey to start your ESG journey.
Come and see us at the Digital Accountancy Show, or get in touch now to discuss how we can help launch your ESG service!