Why Create an ESG “Dashboard”
By Gerald Chew
When you drive a car, there is little question about how you may use the dashboard to lead you to where you want to go and how you get there safely and on time. A car’s dashboard tells you what speed you are driving at and it can tell you how many kilometres you have driven. The objectives are very much the same in the context of driving Environmental, Social and Governance (“ESG”) matters.
The ESG Dashboard
Like a car’s speedometer, odometer, and fuel gauge amongst other instruments on the dashboard of a car, an ESG dashboard is an effective way to track the sustainability performance journey of any company or organisation. The dashboard should track key indicators relevant to the company’s or organisation’s ESG priorities, objectives and initiatives.
Some of the key indicators chosen by a company may be the, (a) diversity of the board, (b) management and employee well-being, (c) occupational health and safety, (d) energy management, (e) water usage, and (f) acquisition and use of raw materials, to name a few indicators.
An ESG dashboard should comprise the ESG metrics most important for your company in the context of the industry your company operates in and the community. A prioritisation process or exercise would be needed to establish what ESG metrics the company should focus on, and this should be endorsed by management and the Board.
It is always necessary to use reliable resources to gather, analyse and use relevant and accurate information and data. Once you have done this, you would be well on your way, to designing and creating an ESG dashboard that may be easily understood, applied, and managed for effect.
Dashboard: Use it to track and improve
Once you have an ESG dashboard that you are comfortable with, update the dashboard regularly with new and important data. A company can gain valuable insights just by tracking, updating, monitoring, and analysing the data and metrics over a given period.
An ESG dashboard if used effectively, may help to identify areas for improvement on the one hand, and on the other, serve as a litmus test to demonstrate a company’s commitment to ESG to its shareholders and stakeholders thereby reinforcing its credibility and standing in the medium to long term.
Closing words: A company’s ESG dashboard is as good and accurate or useful as you would like it to be.
Once a dashboard is established, a company needs to be conscious that it would be looked at as a scorecard and a means of communication with employees, stakeholders, partners and shareholders alike. Communication is key and in that vein the substance of an ESG dashboard should always be candid, truthful and accurate.
This article should not be treated as a replacement for any legal or professional advice and is for the reading pleasure of readers interested in the study or research of environmental, social and governance matters.
The Author, Gerald Chew is a practising lawyer and Counsel at Amica Law LLC. Gerald is also qualified as a barrister of England and Wales.
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