Data and technology are vital components in helping organizations achieve their environmental, social, and governance (ESG) goals. When used strategically, they can empower leaders to make better decisions, improve organizational transparency and unlock efficiencies through more sustainable operating models. Whether it be through more robust non-financial reporting, enabling your decarbonization strategy to achieve net zero targets, or better understanding your climate risk profile, data and technology is the key to unlocking value through your organization's sustainability goals.
Considerations for your leadership team
- How are you using artificial intelligence to enable sustainable value creation and resilience efforts?
- Do you understand the impact of artificial intelligence on your greenhouse gas footprint?
- How are you using technology to improve transparency, governance, and workflow for ESG reporting?
- Are you able to collect ESG data that is relevant to your business?
- Is your ESG data centralized, accurate and trustworthy?
- What technology platforms are used to enable your sustainable IT infrastructure?
- Is your sensitive data safe from cyber threats, including hackers and unauthorized access?
- Are your data and technology systems set up to scale with new ESG regulatory and reporting requirements?
29% of Canadian CEOs cite ESG as the primary operational focus, ahead of talent, inflation proofing, inorganic growth, generative AI and digitization1
78% of Canadian CEOs identified regulatory and reporting obligations as the primary reason for prioritizing ESG1
74% of Canadian sustainability leaders cite ESG data collection and aggregation as a significant barrier to implementing effective ESG initiatives2
You can't improve what you don't measure
Requirements for sustainability data are rapidly evolving and becoming increasingly complex as business leaders refine their strategies and enhance their approach to integrating sustainability into operations. Companies require a complete and accurate picture of their ESG data to not only support internal decision making, but to also consider implications for future third-party assurance requirements, including metrics on the following material topics:
- Environmental: Greenhouse gas (GHG) emissions, energy consumption, usage of natural resources, waste, and recycling rates of materials used in business operations
- Social: Workforce diversity, pay equity, labour practices, and employee health and safety
- Governance: Governance structure and practices, board diversity, ethical business practices, executive compensation, and shareholder rights.
Business leaders therefore need access to a wide variety of ESG data sets from across their front (customer facing), middle (supply chain and operations) and back offices (administrative functions) to properly measure and track progress against key metrics. Processes and controls must be put in place to help reduce exposure to operational, technological, legal and overall enterprise risks caused by poor data collection, analysis, management, and protection practices.
Navigating regulatory change and disclosure requirements
Robust and compliant sustainability reporting is integral to improving ESG performance and meeting stakeholder expectations. Inaccurate ESG data used in reporting can have significant negative consequences for organizations, including increasing exposure to legal risks / greenwashing, diminishing brand value, reducing access to capital, and leading to a decline in the company's share price. As the regulatory environment continues to evolve, Canadian organizations of all sizes may be subject to both local and global reporting requirements, including climate risk management, GHG emissions reduction, elimination of forced labour and child labour in supply chains, reductions in plastics and toxic chemicals, and so forth.
Bridging the innovation gap to unlock new value
There is no one-size-fits-all approach for leveraging technology to solve the most pressing ESG challenges. When combined with robust data practices, technologies such as artificial intelligence and advanced analytics, cloud, and digital platforms can help businesses develop more sustainable products and reduce waste, track and verify ethical labour practices, create a more equitable society, and transition to lower carbon operations – including advancing the measurement, tracking, and forecasting of GHG emissions reductions.
Similarly, advances in research and development will help lead to more efficient renewable energy technologies; improve carbon capture, storage and removal capabilities; scale energy grids to maximize the electrification of transportation; develop more sustainable materials to reduce waste and environmental impacts; and eliminate modern slavery in supply chains.
How we can help
KPMG in Canada's cross functional team of sustainability specialists, business and technology consultants, engineers, legal professionals, and strategic technology alliances can help businesses with their most pressing ESG data and technology challenges.
- Empowering ESG data through AI
KPMG's generative artificial intelligence (AI) solutions streamline and automate traditional ESG data management processes to enable organizations to focus on the insights that matter. Our team of trained machine learning, AI and sustainability experts will help you maximize your sustainability objectives by leveraging AI in a safe, secure and responsible way. - Generating insights on climate and environmental performance
KPMG's cloud-based analytics capability can help businesses centralize and aggregate data from disparate source systems to provide a unified view of their environmental performance data. Doing so can enable organization to automate regulatory reporting and deliver advanced insights with greater confidence from integrated controls and validations. - Transforming the sustainability reporting function
Aligned to their reporting requirements, KPMG helps organizations transform the reporting operating model – through the lens of people, process, data and insights, technology, risk and governance, and service delivery – and implement a digital platform which can provide three layers of automated reporting for external, regulatory, and internal (for management and Boards) audiences. - Mitigating climate and transitional risks
Our tools can run multiple scenarios to assess an organization's exposure to physical risks of climate hazards as well as the economic impacts of the transition to a low-carbon state on a bespoke or an automated basis. And in doing so, help formulate strategic decisions in line with their business needs and regulatory requirements. - Defining decarbonization pathways to reducing GHG emissions
KPMG offers comprehensive solutions to help develop and implement a decarbonization strategy that serves core business needs, achieves climate goals and addresses challenging Scope 3 emissions.
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