Welcome everyone. Um and uh to this presentation on how to measure ESG performance and turn it into business benefits. Um I'm really excited to be here today to talk about this. Uh Well, very important topic, but I'm even more excited to be part of this conference.Uh I think uh women tech network is an amazing initiative and I truly hope that we can all connect after this and keep in touch and maybe in the future, we'll create something amazing together. Um I hope you will enjoy um this presentation. Uh And I hope you will get some new tools on how, how to measure sustainability, create sustainability action plans, policies, et cetera. And if you're already doing, um if you're, if you're already addressing sustainability in your company, I hope you will still enjoy it and maybe get some new tools. Um But before we start, um let me introduce myself. My name is Ilma Katani. I am uh one of the co-founders and the CEO of SDG Monitor. Um A couple of words about SDG monitor um in all its simplicity, we help companies to become more sustainable and we like to call ourselves um data driven advisory with scalable tools. And what this means is that we create solutions and software that help uh not only our own work, but that we can leave uh with our clients already after uh to continue the sustain their sustainability journey.

Uh We want to always make these tools public so that any company can use them. Um Our first tool is called the SDG monitor tool and it has been out now for two years and it helps companies measure their sustainability um show the ESG impact and communicate uh this impact through intuitive dashboards. Um So if you get inspired today, please go ahead and create an account. It's fully free. And uh uh and uh and yeah, uh and if of course, if you have any questions, please, please don't hesitate to ask uh or contact me. So let's dive into the topic. Um So currently um companies and in the past few years, companies are, have really started to feel the pressure to address sustainability and bring it into their strategy either as a core factor or a must factor. So always before you start with creating policy uh or these action plans, it's important to answer why sustainability. What is the reason for measuring sustainability performance? Is it uh a must that is driving, that is driving your sustainability forward. Is it legislation change?

Um Here in Europe, we have new directives and regulations. I feel like they're coming out weekly. Uh but there is the CS RD eu taxonomy uh SFDR for the financial sector in the UK, there is a 10 point plan um in the US um Inflation Reduction Act. So is this the thing that drives uh your sustainability on top of that we have requirement? So is your investor uh for example, uh requiring you to create a sustainability action plan or are you part of someone's uh supply chain? Uh and they are, they must comply with these regulations uh And they request data from you. So these are, these are two factors that might be driving uh your sustainability forward. Is it an opportunity? So uh is business innovation um going into circular economy model um creating competitive advantage for you? And this is uh you see this is a business opportunity to start uh addressing sustainability or is it a purpose? Is it value values and purpose that is driving you forward, is growing your business and enhancing social uh well being without harming the environment, the leading strategy here. So, of course, this is not the complete truth. Um uh Most of the companies have a hybrid of these uh different levels.

But answering this, this um this question is, is really important to help you understand where you need to start because depending on this, uh you have a better understanding of the narrative of your sustainability, but also uh ambition of the goals that you are going to set.

So after you have answered this question, you're ready to um start creating your sustainability road map and this is what we do at SCG monitor for our clients. And this is the main tool uh directing the sustainability. So we have uh identified four main steps. Uh So ESG screening action plan reporting and data management and ESG software impact management tools, um carbon accounting tools, etcetera. Um These uh these are very um interconnected with reporting and data management. Uh But of course, uh you don't have to do it. Uh It will help you, but uh it's not a request. So that's why it's its own component. And I thought that today we could go through step by step all of these uh specific uh these steps. So the first one screening. So this uh is how to start. Uh And this is about understanding sustainability context in your industry, operational environment and company to make this more concrete. Uh Let's take as an example uh Tony Scollo, which is a Dutch uh confectionery um uh company that is producing and selling chocolate. So their operational environment is really where the raw materials, which locations, which countries, these raw materials are produced. So, for example, Coco um if they uh they need to understand what are the, what are the human rights and labor laws there. And if they want to, for example, uh create uh create more uh uh create this uh this cocoa or produce this cocoa more uh more energy efficiently. They need to understand what are the share of renewable energy in the grid. For example.

So really understanding the environment and the location you're operating in and what that means is sustainability. When we look at industry, well, we're, we're, we are focusing on chocolate. Here we are uh we need to understand how much food waste we are creating. Um also company level, very important. So for example, we want to create paperless offices or we want to change uh into fully electric vehicles. So what is the sustainability uh actions that we want to create on the company level? So this is uh and what are the ESG challenges on the company level? So when the screening has been done, uh let's get going. Um the current market is really much focused on data analytics and reporting, but there's really nothing to report if you don't act. So let's start creating an action plan. Uh These are the things that you would like to solve and these are things that uh you can solve. So what do you need to do to create positive environment, social and governance impact through your business? And what are the long and short term goals? And what are the actions to reach these long and short term goals? And then you also um you should also um map these actions to business benefits. Now we're going to look into um the ESG impact uh and the business benefits in, in more detail. But I wanna give, I want to also uh say a couple of words about long and short term goals.

Now many companies or most of the companies have goals that go into 2030 into 2050. But it's so important to also break this up into short term goals because it is not uh the responsibility of the people uh working in the company in 2030 to reach these goals. Now, it's also it's the responsibility of, of everyone working there now and up until then. So we always advocate, for example, our clients um to write something that is the promise from the CEO, what will the person as a leader do uh in order to reach these long term goals? But OK, let's look into uh now the governance, social, uh the environment, social and governance impact. So now you're taking the screening into uh more concreteness, you create the actions based on these uh challenges uh and impacts that you have chosen. So, is it going to be reducing CO2 emissions? Is it going to be climate change mitigation? Uh Is it going to be uh more sustainable production and consumption on the social level? Are you going to uh create stronger gender equality, uh better social, economic and political inclusion and on the governance side, increasing sustainable uh growth, what are you going to do to really grow your company? Um and taking sustainability into account? Uh there as well.

Uh Are you going to um create more or uh create more uh frequent reporting in order to increase transparency and disclosure? So these are the themes uh that you need to focus on and you need to choose uh which ones you want leading your sustainability action plan. So the actions based on these ESG impacts should also be mapped into business benefits. And at seg monitor, we always look at it from three different perspectives. So uh do these actions increase profits? Do they save costs or do they build the brand? So maybe uh there are new business opportunities um collaborations uh um that will uh create greater margins, uh increasing sales or competitive edge for saving costs. Uh We have uh less waste uh improved health and well being. Um There we have a client for example, who have uh created or who have made um great investments into the health and well being of their employees. Uh And this, they're also measuring it in terms of like sick leaves that they are uh in terms of the sick leave days or uh they want to make sure that uh they're feeling good at their jobs in this way, also saving costs. Uh then there is building brand. Um So how can we make stronger purpose and culture? We know that there is a great resignation uh going on. So how can we create more purpose within the company? Um better employer?

Image and stronger employee engagement and of course, uh trust and uh transparency through communications. So when you have uh created the actions, it's time, time to start setting up uh the performance measurement. Uh and this is done uh through reporting and data management.

So the first thing uh is to um is to look into the industry specific uh KPIS uh look this, this can be done by looking into the peers, uh which is also how you benchmark your company. Uh So different frameworks have already started creating these uh these specific uh KPIS uh and the frameworks and reporting standards are all also a great way for you to organize your reporting. So there is, of course, GR ISA SBS CGs. Uh And of course, the GHG protocol uh and these are the ones uh these following these frameworks will really give you the credibility. Uh It's also very important to be transparent and use good methodologies. Uh We have so many companies uh asking how are we doing against our competitors? And it's very hard to say if a company is doing good or bad. If they're using completely different methodologies, then you have the impact management tools or the ESG software. So you have the carbon accounting tools that help you calculate your CO2 emissions. This is the time um when you have set the actions to think about how we are going to um how we're going to uh uh manage this uh we're going to measure the performance. Uh There are also reporting tools that produce ready to use reports for you. Uh And also indeed, for example, CG monitor helps you manage these actions.

Um But then there is um sustainability data and this is um this is a tricky one because sustainability data, there is no really no such thing as sustainability data, but it is a result of many steps of data processing. Uh It's a combination of formulas assumptions, uh data from external actors, manual entry, uh emission factors, documents, et cetera. And these together determining some an end value for reporting and measurement. So to increase the trust and transparency, it's it's essential to give the source uh of the data and the methodology for how it has been processed. Uh So you might need to identify here uh different er P sys uh the er P system, you need to use that or you have hr systems uh to start the measurement. So it requires a lot of processing and I want to also look into this elements of sustainability data. Now we have two we have identified two factors. Um So the quality dimensions and source management. So for so quality dimensions for data in general, these um normally it's about accuracy, timeliness, uh relevancy completeness. But we uh we think that for sustainability data credibility, transparency and comparability are the key key elements. So credibility is about that you are doing something based on a framework.

So here it would be certificates uh standards. Uh So as I mentioned already, you're following gr I you're reporting, uh you're reporting um in accordance with that or you are uh you are looking into an iso standard. Um that's for the credibility part, then there is the transparency.

So this shows how you are doing it. Um So the actual performance uh if you want to increase um transparency, maybe you might look into Blockchain solutions uh also so important here to, to communicate uh and support the data with explaining for example, why it didn't go as uh as you expected. Uh why this uh why this data data or the specific uh value this year was not as good as last year. Uh but don't be scared to show bad numbers. This only indeed increases the transparency of of it. Then there is a comparability, so reflects your performance against your competitors. So if um this is what industry specific KPIS are for, for example, or the GHG protocol or the or the SPT I, so the uh science based target initiative. So following this will help you also to uh to benchmark your company. Then there is the source management. So who is responsible for this data point? Is it the project manager or is it uh actually um some other systems? So as I was mentioning an er P system where the data is coming from, which bring brings us to the reliability. How reliable is the source and what supports the data?

So is this data point indeed uh um obtained from uh from an email or an Excel sheet or is it uh through an integration to the er P system? Um then finally, we have of course validation. So who validates the data? Who is going to make sure that it is what it, what it say, what it says it is? So is it uh is there a third party or is it someone within the organization? So this, these are so there is the quality dimension and source management very important to document uh when you are uh when you're showing the sustainability performance. Then finally, uh before we uh we end, we still have uh three minutes. Uh I wanted to show the sustainability program of uh one of the um the sustainability program of a Finnish company. Uh no uh partners, which is a restaurant group behind approximately 250 restaurants, bars, pubs, nightclubs, et cetera. And here is, here is I think a great visualization of how you can show uh your sustainability program one. So you have the EFG impact. Now, they are focusing on environment and climate people and communality and good governance um on the goals for the environment. They have sustainable sustainable procurement and mitigating environmental impact. Uh They have the actions here. So reducing carbon footprint, uh resource efficiency, then they have the KP I so what are they, how are they going to measure it?

Uh So for minimizing food waste, they're actually uh measuring uh the kilogram of food waste per, per Euro. So this goes straight into the business impact or the business benefit. They are trying to save costs by minimizing the food waste. Uh Then of course, SDG impact. Um Here they are uh mapping it to SDG uh 12 sustainable production and consumption. And seg number nine which is about infrastructure innovation uh for decreasing CO2 emissions. And this same goes for the S and the G as well. So this is just uh a way to end this presentation uh to see that this is a, this is a very comprehensive and holistic way of showing your sustainability program. And also a great way of explaining how you're planning to measure the ESG uh ESG performance. So one minute left, thank you very much and let's connect on linkedin. So my name is Vilma, if you have any, if you have any questions, uh please don't hesitate to contact me on uh Vilma Seg monitor.co. And uh yeah, I hope to hear from you soon. Thank you so much. And if there are still any questions, I think we have time for one. Uh you can get the slides. No problem. I can of course, send them to you. Uh Thank you so much. I hope this was uh this was uh in uh this was helpful for you, um.