ESG – mysterious acronym, real challenges, or… why it’s so important for business and the environment

An interview with Ewa Wesoły-Jakubczyk, sustainability manager at Etisoft

– Let’s decipher the acronym ESG, which is inextricably linked to sustainability – an area you are responsible for at Etisoft.

• Of course, ESG stands for:

• E (Environmental) – the environment, i.e. the company’s efforts to protect it, such as CO₂ reduction, energy efficiency, waste management, biodiversity protection.
• S (Social) – social aspects, i.e. how the company treats employees, cares about human rights, gender equality or workplace safety. This also includes relations with customers, suppliers and local communities.
• G (Governance) – corporate governance, including company management, business ethics, financial transparency, board structure and anti-corruption.
  It also includes information security, compensation policies, risk management and volunteer activities for local communities.
  Environmental and social awareness in society is growing. Companies are also realizing that they cannot focus solely on generating profits. They must responsibly manage their environmental impact and corporate governance. These are the expectations of us consumers.

For a long time, such actions by companies were voluntary. This meant a lot of discretion, lack of consistency and often outright avoidance of obligations. The situation changed with the CSRD (Corporate Sustainability Reporting Directive) and the need to report in accordance with ESRS (European Sustainability Reporting Standards). The directive obliged all countries to present long-term scenarios for reducing greenhouse gas emissions in accordance with the adopted methodology. The goal is to curb climate change and seek to halt the rise in global temperatures. Actions are aimed at balancing greenhouse gas emissions by 2050 and making the world carbon neutral. In practice, this means moving away from fossil fuels to more sustainable energy sources.
Signatories to the agreement have also committed to other goals (such as improving quality of life and promoting gender equality). Each of these has a timeframe, hence the acceleration of action.

– At Etisoft, we are already completing ESG questionnaires from customers and preparing for reporting under the EU directive. How are we prepared for this?

– Effective ESG reporting requires a strategic approach and an understanding that it is not just about meeting formal requirements, but about providing valuable information that influences financial decisions. The process should be preceded by an analysis and assessment of so-called “dual materiality” to identify key ESG aspects for both the company and its stakeholders. Gaps and areas requiring corrective action should also be identified.

Data in reports should be transparent, consistent, measurable, comparable and verifiable. We already collect a lot of data (energy consumption, water consumption or waste management). For the past two years, we have been moni-toring CO₂ emissions, although for now in basic ranges. Replacing the company’s car fleet with hybrid cars is also part of the drive to minimize environmental impact.
We report our data on the Ecovadis platform, behind which is a rating agency that provides companies with valuable data on the environment, employee rights, ethics, procurement and human rights. Etisoft, with a Bronze Ecovadis Medal, is among the 72% of companies rated by this platform with a score of equal or higher – a very good result.

The EU report is more than 1,200 precise questions, and the answers must include specific data and targets for improvement. The greatest emphasis is placed on reducing greenhouse gas emissions. To make them easy to compare, they are reduced to CO2 equivalents.

– There is a lot of work ahead of us, not least because reporting requires stakeholder engagement, building awareness among employees, improvement and integration with existing processes. There are also unknowns…

– This is true. As with anything new, regulations and guidelines will change to adapt to reality. Auditors will be chartered accountants who will also gain experience in this field. The bar is set high, but I am of good cheer. I hope that ESG data reporting will allow the company to identify new market opportunities as well as potential risks.

Personally, I am an idealist and believe that the world can be a better place. In my next incarnation, I’ll probably collect garbage in the seas and oceans:) For now, I make small but conscious decisions: I separate trash, I don’t impulsively buy clothes, and I give plastic cheese wrappers a second life by using them as boxes.

– Thank you for the interview.