The Intersection of EHS & ESG – Why It Matters

For some time now, I have been following an evolving product concept that is gaining momentum: the idea that Environmental, Social & Governance (ESG) compliance reporting software should be a logical extension of Environmental, Health & Safety (EHS) system software.

If you are not familiar with ESG, not to worry – yet.  According to Investopedia, “ESG criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. Environmental criteria consider how a company performs as a steward of nature. Social criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. Governance deals with a company’s leadership, executive pay, audits, internal controls and shareholder rights.”  This clearly is more relevant for large organizations interacting with the capital markets than for smaller, privately-held companies today, but it is a good bet that at least some of the ESG concepts will become normalized for most companies – particularly those supporting environmental impact.

A full-blown explanation of ESG compliance reporting is beyond the scope of this article, but the process is presented well by the Global Reporting Initiative (GRI), one of the leading standard-setting organizations for ESG reporting.  The basic concept is that organizations must analyze their operations to identify how and in what manner they impact the environment and their communities, then select Material Topics that are directly relevant to their industries or situations, and then very specifically report on how those Material Topics are being managed.  These discussions must be supported with data, and for some criteria, necessarily require employee input.

So what does this have to do with the safety professional?  Maybe plenty, depending on your organization.  Much like for safety systems, collecting the data and reporting on it isn’t the hard part – that could be easily integrated as an extension of a well-designed safety system, or with the numerous standalone ESG compliance systems that are being brought to market.  The key to successfully implementing a positive ESG culture has a lot of overlap with the discipline required for growing an effective safety program.  And a strong safety infrastructure, like that required to support ISO 45001 or VPP for example, provides a natural framework for implementing ESG data collection.

Once again, we see that safety software doesn’t just support safety – the platform is much broader.  Even more important, ESG compliance is an opportunity for you as a safety professional to bring your expertise to support another organizational objective whose requirements largely match what you are already doing.  Let us know if you would like to learn more about this opportunity and your potential role in your organizations’ ESG program.