It’s not a secret that sustainability matters for a host of reasons – climate changes, health inequalities, loss of biodiversity etc. From a business perspective, we know sustainability means dealing with regulatory demands from governments, investors and third-party stakeholders that are rising at a rapid pace. It’s also clearly tied to reputation, as brands and organisations attempt to differentiate themselves from a sea of competition through social and environmental actions. Importantly, consumers are increasingly influenced by the sustainability footprint of the products and services they buy.
Many companies are “talking the talk” to fit into the current cultural pressure to become greener or environmentally friendly but lack any real data to back up their claims in a tangible way. It can even verge on greenwashing, where companies spend more and more resources on marketing themselves as “green” rather than doing anything to actually minimize their environmental footprints. Greenwashing can have legal ramifications, too.
We all know sustainability is important to businesses, and many say they’re taking action, but how can a company actually prove how sustainable it is? You need evidence. You need data.
Where to Start
When the EU food labelling regulation unfolded in 2011, every organisation involved in the supply chain of food producers faced a headache of a task – making sure the information on their packaging reflected the same information that was online. That task included restructuring of nutritional labels, making sure allergens were in bold, organizing by carbohydrates, fats, sugar, etc. When the regulation first came out, many companies found themselves behind from the get-go, forced to figure out their data and pull it together all while navigating all the new rules.
What we’re experiencing now with sustainability is similar to that of food regulation. At some organisations, people might not even be aware that their own team is responsible for elements of the business’ sustainability plan. Where do you begin? How do you get an overview? To avoid greenwashing and actually figure out – and prove – how sustainable a company really is, it has to get its data in order. But which data? With no universal standards and over 600 sustainability ‘standards’ – further complicated by regional, industry and category variants – it can be overwhelming to know which data you need to collect and when.
Tap into Sustainability Data
Managing sustainability data generates metrics which are used to quantify actual activities related to sustainability and ESG assessments. A good master data management (MDM) tool makes it quite easy to remove silos of data, generating a 360-degree view of data related to sustainability throughout the entire value chain. It is critical that organisations elevate sustainability data to the same level as other core business critical master data, and apply the same discipline, governance and rigour.
Sustainability MDM opens doors to a whole range of actions, such as managing compliance details, connecting sustainability data to corporate ESG reporting, preparing products to leverage the business around circular economies and managing data related to the United Nation’s Sustainable Development Goals. Not only will it become easier to please regulatory capital markets investors and shareholders, but it is an opportunity to bolster brand reputation and build consumer loyalty and trust.
Connect Sustainability with MDM
More and more, we are seeing companies create the role of Chief Sustainability Officer (CSO). This is a C-suite, big picture role – they aren’t typically going to be looking at master data management to achieve their CSR/ESG reporting goals. When decision makers make the connection between their sustainability goals and a master data management solution that has nearly endless capabilities for managing and curating the complex data sets that will need to be collated, those goalposts will move a lot closer.