ESG strategy & transformation

The business world is going through a fundamental transformation. In Switzerland and across the globe, governments are changing the rules of the game to drive a transformation towards a more sustainable economy. Customers, employees, investors and the public at large are rapidly increasing their demands for transparency and meaningful improvements on sustainability performance by corporates. This transformation affects all Swiss companies in all sectors – and it calls for a board and C-level review of how to integrate sustainability considerations into corporate strategy.

In any transformation of this size, there will be winners and losers. In some sectors, there is a stronger case to move quickly and decisively. In other sectors, a more gradual approach may be warranted.

Work with KPMG to find your strategic path towards integrating sustainability into your corporate strategy to drive both sustainable impact and economic success in this new world.

Make sure your organization emerges from this transformation as a winner.

Florian Bornhauser

Director, Deal Advisory, Head of Strategy Group in Switzerland

KPMG Switzerland

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Adrian Stoll

Director, Sustainable Supply Chain & ESG Advisory

KPMG Switzerland

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Key questions to future-proof your organization

Boards and CEOs need to ask themselves a number of important questions to future-proof their organizations, such as:

What should our sustainability ambition be? And how can we integrate that ambition into our overall business strategy?
Where is the pressure to change coming from? Is it regulation? Investors? Customers? Employees? What is important to these stakeholder groups?
Consequently, which areas of the “E”, “S”, and “G” should we actively monitor, manage and improve?
Are our business and operating models still fit for the future? Or will we need to change what we sell, how we sell it and how we operate to be successful in a greener economy?
Assuming that some degree of change is needed, does our internal organization enable us to make the necessary changes?
How can we use partnerships or M&A to accelerate our sustainability transformation?
And, last but not least, how will we finance this transformation?

Learn more about how to integrate ESG in your strategy

How to start your ESG journey with KPMG?

Given the breadth of the topic, truly integrating ESG can be overwhelming and the consequences far-reaching. Not surprisingly, many companies wonder “where to start”.

In this context, an “ESG Health Check” is a helpful first step. It:

Diagnoses and prioritizes key areas for action across relevant ESG dimensions such as strategy and initiatives, governance & organization, reporting & regulation, and data & technology
Is a cost-effective way of assessing key areas for action before committing to more extensive transformation projects

Provides access to full, cross-functional KPMG ESG expertise (strategy, reporting, regulatory, tax, etc.)
Provides specific recommendations on next steps to determine further action on the basis of a well-informed fact base

Subsequently, KPMG can help with all the steps shown below to truly integrate ESG into your organization's DNA.

Contact us for an ESG Health Check

Key steps towards integrating ESG into your organization

Decide on ambition level
A sustainability transformation is no easy feat. The effort it takes and the significance of its outputs will very much depend on your overall ambition. As you set off on your sustainability journey, you need to ask yourself:
- Do we want to be just “compliant with regulation” – or do we aspire to use the topic as a strategic value creation lever?
- What are our competitors doing and what are the trends in our industry?
Materiality assessments

Sustainability is a broad subject, spanning many environmental (“E”), social (“S) and governance (“G”) topics. No company can manage them all. Hence, right after setting an ambition, the journey starts with identifying which of these areas actually matter in your context. Since materiality assessments are also required in important ESG disclosure regulations and standards, it is important to consider the relevant regulatory formalities when preparing double materiality assessments upfront.
Formulate ESG strategy
Based on your material areas and your overall ambition level, you can now articulate an overall plan and roadmap (i.e. where do you stand today? where do you want to go in 5-10 years? how can you get there?).

For many companies, this roadmap needs to answer questions such as:
- Climate
  Do you have an understanding of your current carbon footprint and do you have a plan on how to get to Net Zero (required for all Swiss companies by 2050, for some even by 2040)? Do you understand the physical and transition risks and opportunities your organization faces in the light of progressing climate change?
- Circularity
  What role will circular business models play in your sustainability transformation? For example, what contribution can it make to your decarbonization ambition?
- Supply chain
  Will your engagement with suppliers need to change, for example in the light of topics such as child labor, conflict minerals or Scope 3 emissions? (also visit our Sustainable Supply Chain page for more details)
- Data
  What data are you able to gather in a reliable manner today and how will this need to change as you move towards managing and reporting on sustainability more stringently going forward?
- Governance
  Do you have the right roles and responsibilities in your organization to effectively drive sustainability transformation? If not, what should your future organization look like?
- Trade-off between sustainability and financial targets
  What balance will you strike on topics that might make you more sustainable but will increase your costs? Which sustainability actions can you take to drive financial value?
- Financing
  How can you finance your sustainability transformation? Are you aware of and are you utilizing new sustainable finance instruments, or any of the green incentives and tax options available?
- Transactions
  What will be the role of M&A or partnerships to drive your sustainability transformation?
- Communication
  How will we communicate our sustainability efforts? Will we pursue certain external certifications (eco label), ratings or pledges to make our commitment public?
Visit our ESG & Sustainability page for more detailed information on many of these areas by our functional specialists.
Drive ESG transformation
Once you have articulated your overall ESG roadmap for the business, you will be in a position to drive the implementation of your ESG ambition, for example by:
- Developing topical or functional targets and action plans – for example, setting a science-based decarbonization target (e.g. “net zero by 2050”), charting a pathway to get there, developing specific circular-economy based business models, etc.
- Implementing ESG reporting systems and monitoring mechanisms
- Re-designing organizational responsibilities and governance to enable effective management and integration of sustainability into everyday operations
- Driving ESG transformation by supporting change management efforts (e.g. communication, PMO, etc.)

Your benefits

KPMG is at the forefront of helping companies deal with the disruption caused by the sustainability transformation.

By working with us, you will benefit from:

Strong ESG subject matter expertise: KPMG has built international centers of excellence in key topics such as climate and decarbonization, circularity, biodiversity, human rights and more, consisting of former academics, corporate heads of sustainability and the like. For you, this means direct access to cutting-edge “E”, “S” and “G” subject matter experts
Strategy-to-results DNA: At KPMG, we pride ourselves in performing strong strategy work with implementation complexities in mind (i.e. all plans must be realistically implementable). And our organization is well experienced at supporting companies beyond the planning stage to make transformation happen

Deep cross-functional expertise: Successfully integrating ESG into your strategy requires strong multi-disciplinarity. Besides questions of strategy, the market and competition, key areas of complexity relate to a fast-changing regulatory landscape, tax incentives, public reporting, etc. Thanks to KPMG’s multi-disciplinary model, you will have access to integrated capabilities across all of our functions (advisory, audit, tax & legal)
Global reach, local knowledge: We have fully-fledged ESG Strategy & Transformation capabilities in Switzerland – but at the same time, by working with us, you will gain access to a global network of over 200,000 professionals across the globe who can enrich the project with relevant local knowledge. This is particularly important for clients who operate internationally

Contact our ESG experts

KPMG as a trusted partner can help you answer all the questions shown above.

We do this through a bespoke strategy service, working with your board and C-level in a tailored manner, drawing on international sector expert networks and deep technical ESG expertise across all our functions (advisory, audit, tax & legal).

We will gladly remain at your disposal to answer further questions you may have.

Contact us for strategic questions