How Planning Technology Can Help Companies Achieve Their ESG Goals

Linda Copeland, an Associate Principal with The Hackett Group focusing on emerging opportunities for leveraging technology, discusses the increasing focus of companies on Environmental, Social, and Governance (ESG) issues, and how they can use technology to more effectively drive performance improvements.

Show Notes

Welcome to The Hackett Group’s “Business Excelleration Podcast,” where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance. This episode, hosted by Gary Baker, Global Communications director at The Hackett Group, features Linda Copeland. Linda is an associate principal at The Hackett Group who focuses on emerging opportunities for levering technology. Gary and Linda discuss how planning technology can help companies achieve their environmental, social, and governance goals. This is an area known as ESG.

The conversation begins as Linda explains this emerging topic among firms. ESG stands for three areas of evaluation. Companies can set and achieve goals and standards regarding the environment, social issues, and governance. The market has traditionally been driven by investors and was less focused on social and relational issues. Now, companies that do well from an environmental and social perspective can do better in business. ESG presents three buckets of opportunities for companies to grow.

Linda gives examples of each area of ESG. Environmentally, companies may track their water usage, energy usage, material usage and recycling. Socially, companies may measure their gender and ethnic equality, and consider the causes which they fund. At a governance level, companies may consider the diversity of their board of directors and whether or not the company is complying with regulatory expectations. As an emerging field, boards are beginning to arise, which provide accountability and feedback for companies on what they should do.

Gary asks Linda what regulations currently exist. Linda highlights regulations in the EU because companies are required to provide disclosure on ESG. She explains that regulations in the U.S. disclosure rules appear to provide more opportunity for investors to pick companies who are meeting needs from a social perspective. As an example, Linda discusses lending requirements tied to ESG metrics.

Since ESG is an emerging area of responsibility, it is in its infancy stage as it relates to supportive software and technology. Linda presents the best ways to implement ESG standards through leveraging existing products. Using current software, focusing on strategic and financial planning, companies can immediately begin to integrate ESG goals. Listen as Linda highlights and explains a number of ways in which enterprise performance management (EPM) can help groups become more efficient and measure the organization in order to achieve ESG goals. She challenges companies to consider how planning technology can create progress on this emerging topic of interest.

Timestamps:

• 01:15 – What is ESG and what impact does it have on companies?
• 02:30 – Linda explains three buckets of opportunities for companies to measure.
• 03:40 – What are the regulations around ESG and how is this landscape changing?
• 04:50 – The benefits of ESG are explained from a corporate governance perspective.
• 06:10 – Linda highlights how current technology can help firms achieve ESG goals.
• 09:10 – How can companies use EPM to support ESG?
• 11:05 – Examples given on how companies use EPM as a platform for ESG goals.
• 13:20 – Linda explains how existing products support ESG reporting.