Sustainability in the company
10 reasons for voluntary ESG reporting
Sustainability and social responsibility are becoming more and more relevant, and ESG reporting is thus also increasingly coming into the focus of companies and their stakeholders. Although not all companies are yet legally required to publish ESG reports, there are still good reasons to do so voluntarily. In this blog post, we will look at the benefits of this voluntary ESG reporting.
What is ESG reporting and why are not all companies covered?
ESG reporting refers to the disclosure of information about a company's environmental impact, social performance and corporate governance. For the time being, the current regulations only cover companies with a certain size, number of employees and turnover. For more on this topic, see our guide through the ESG jungle.
Despite the varying obligations for ESG disclosure, reporting on sustainability behavior has great benefits for any company.
10 reasons for voluntary ESG reporting
1. Transparency and credibility
By voluntarily publishing an ESG report, a company signals its transparency and increases its credibility with customers, investors and other stakeholders.
2. Reputation gain
Companies that actively communicate their sustainability performance can improve their reputation and standing. ESG reports show that the company goes beyond financial metrics and cares about environmental and social issues.
3. Competitive advantage
Voluntary reporting can help companies differentiate themselves from competitors and strengthen their competitiveness. ESG criteria have an increasing influence on the decisions of customers and investors.
65% of consumers would be willing to end their relationship with a brand if it did not take sustainability and social initiatives seriously (Oracle 2022).
4. Risk management
By publishing the sustainability report, companies can better identify and assess their environmental and social risks. This enables them to take appropriate action and ensure long-term stability.
5. Stakeholder requirements
As the competitive advantage already shows, the demand for stakeholders to consider ESG factors in the company is increasing. Disclosure thus promotes stakeholder dialogue and meets stakeholder requirements.
6. Employee retention and recruitment
Sustainability efforts are an important factor for many employees in choosing their employer. By disclosing their sustainability strategy and achievements, companies can demonstrate consideration of their social and environmental responsibilities and gain an advantage in the "war for talent".
52% of potential employees rule out non-sustainable companies as employers, according to a study by the Boston Consulting Group 2021, which is why a company's sustainability performance is also assessed before applying.
Furthermore, it increases employee loyalty to the company if private values are taken into account in the company.
7. Increasing efficiency
Sustainability efforts often go hand in hand with improved resource efficiency. An ESG report allows companies to document and communicate their progress in energy conservation, waste reduction, and environmental efficiency.
8. Innovation potential
Sustainability often requires innovative solutions and new business models. By collecting their ESG data, companies are encouraged to look more closely at sustainable innovation and recognize its potential for new business opportunities.
9. social contribution
Companies can use their reports to document their contribution to society and show that they go beyond financial gains to help solve global challenges.
10. Environment
As a company, addressing its own impact on the world's climate serves as a foundation for carbon reduction measures, which in turn helps to combat the ongoing climate crisis.
Glacier Responsibility Report
Glacier also publishes an annual Responsibility Report that highlights the previous year's sustainability performance. Data collection and implementation is the responsibility of our "Green Team", which focuses on and promotes environmental and social sustainability within the company.
"We have decided to write our first report in 2021. As a start-up, we are still legally obligated to do so, however, we see many advantages. On the one hand, we can observe how the legal situation regarding sustainability is constantly changing and, in most cases, becoming stricter. Thus, voluntary reporting already prepares us for the future and can be seen as risk minimization. In addition, the reporting process reveals an enormous amount of potential for improvement. Sustainability should be lived in every aspect and this also includes the critical examination of ourselves, continuous improvement and further development in our sustainability strategy as well as the company as a whole. We want to communicate transparently and show that sustainability reporting makes sense for any size of company!"
says Tanja Halicki, Green Team member at Glacier.
In summary, this means...
...just because there is no legal obligation to disclose climate protection measures, companies still benefit from ESG reporting. Employees, customers and stakeholders in general already attach great importance to sustainability, and the trend is increasing.