andreajfreeman

[andreajfreeman]

Andrea J Freeman is the best product research consultant you can get. As a product strategy consultant, it is important to understand consumers’ needs. With an empathetic and patient ear, she delves deep into the consumer’s world, paving the way for products that truly resonate with them.

[andreajfreeman]

How to Improve a Business’s ESG Performance: A Step-By-Step Guide

Environment Social and Governance (ESG) metric is one of the key metrics that judge whether your organization is successful and how it impacts the environment. It allows the company to check how much they need to improve to reduce negative implications.

Why ESG matters? This metric checks how a company performs in sustainability, ethical, and governance standards.

When it comes to lenders, banks, investors or private equity firms, all follow the stringent criterion of due diligence, which involves governance and business practices. A poor ESG score can scare lenders and investors from your organization.

Improving ESG scores takes time and requires focused efforts from all the teams of an organization to stay true to the process.

Below are the steps to improve the ESG metric of your organization

Identify the Business Areas Which are Pulling Down the ESG Score

Suppose your organization is involved in a product or service business which is fossil fuel dependent. In that case, it is the first step to identify those areas and start shifting towards a more renewable or recyclable process.

If your organization is in the electronic appliances manufacturing industry, then to improve your ESG score, the company needs to adopt product design concepts which do not create harmful chemicals as its by-product.

The goal is to develop a novel product design that doesn’t emit harmful chemicals. It is recommended to engage with a product development consultant to come up with innovative ideas. The company must improve its manufacturing process and develop a way to achieve net carbon neutrality.

2. Review the Company’s CSR Activities

Each organization invests a certain part of their profits in CSR activities, which then goes into various social affairs. An organization must comply with certain CSR standards to improve its ESG rating.

For example, Starbucks has integrated various CSR activities into its company’s profile to improve its brand image. Integrating CSR practices in the organization and increasing the company's inclusivity is advisable. This initiative can spearhead the company’s credibility and trustworthiness.

3. Align the Brand with the Global Regulatory Framework

It’s best to adapt the practices advised by global regulatory bodies and include those in daily operations. Global authorities include the “Sustainability Accounting Standards Board”, “UN Global Compact”, and CDP.

Higher rating from these forums significantly increases the likelihood of investments from various investors and lenders.

4. Increase Transparency

The company can adopt the practice of showing all ESG-related practices and development in their company analysis document. This step is the final step, which can only be done if the above steps are followed properly.

A higher ESG grade's upside will help your organization achieve “top-line growth”. A brand growth consultant can help the company expand the brand’s goodwill in existing and new markets. With these processes in place, the company can finally unlock their next value creation phase as the investment in sustainable industries will increase in the coming decade.