that could be classified under sustainability can make it very hard for a company to address and manage them . For this reason , a company should identify and prioritise the issues that are most material to its business and most relevant to its stakeholders .
2 . Collect data from internal and external stakeholders . Internal stakeholders should include critical managers and business leaders , while external stakeholders should cover significant actors outside of the company , including business partners , community representatives , and NGOs . They should all be asked to weigh a list of issues by their relative importance .
3 . Map and prioritise the issues . In this step , all of the data collected from internal and external stakeholders is put into a model or framework and transformed into a quantitative score that can be used to map and prioritise issues .
4 . Align the issues with management and business vision . Once the data is collected , it can be integrated into business strategies and risk assessments .
5 . Reporting on progress . Most companies publish annual sustainability reports to report on progress . These reports generally refer back to the materiality matrix and the sustainability strategy and provide an update on key metrics and targets .
Overview of Reporting Frameworks
Companies use several key frameworks to develop an understanding of the critical materiality issues they should consider and report on . The frameworks each have a different purpose , audience , and articulation of the materiality concept .
Companies ’ materiality assessment will help pinpoint which frameworks , goals , strategies , and portfolios align well . Several of these frameworks require similar data and information that , once identified , can be easily repurposed for additional reporting processes .
ESG Strategy
Companies should look to incorporate various ESG trends , practices and ideas into their plans . Some examples include reducing greenhouse gas emissions , creating more responsible and sustainable supply chains , implementing climate adaptation measures and adopting a circular economy model , which aims to reuse product components and materials instead of throwing them away or recycling them .
With such considerations in mind , here are eight steps to take in developing and implementing an ESG strategy : -
1 . Get input from internal and external stakeholders . Consult with board members and business executives about ESG issues that are important to the business , and talk to various other stakeholders -- employees , institutional investors , customers , suppliers , community leaders -- about ones that matter to them .
2 . Assess the materiality of different ESG issues . Use the input you ' ve gathered to identify the issues that are most important to both the business and stakeholders , as well as the issues that are less important to either party or to both . The individual elements of the ESG strategy can then be prioritised based on that assessment .
3 . Establish a baseline on ESG performance . Document current performance levels , policies , practices and statistics on the ESG factors that will be addressed as part of the strategy . Doing so provides a starting point for future comparisons to evaluate the progress of ESG efforts .
4 . Define measurable goals for ESG initiatives . This involves setting objectives and performance targets for the ESG strategy as a whole and the various pieces of it . Some of these goals might include desired improvements on KPIs , while others might call for maintaining current performance levels and practices that already meet requirements .
5 . Create a deployment roadmap . Next , build a detailed implementation plan for the ESG programme with project timelines , milestones and responsibilities .
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