Unlocking the Power of ESG Reporting Software for More Resilient Business
- Understand ESG Reporting: Learn the basics of ESG, types of reports, and how to select the right framework for your business.
- Key Features of ESG Software: Discover the top characteristics to look for in ESG reporting software, from customization to compliance.
- BanQu's Holistic Solution: Explore how BanQu's platform provides real-time traceability and integrated ESG reporting to boost supply chain transparency and resilience.
If you’ve worked in tech or business, it’s no secret that ESG has been an on-again-off-again hot topic for the past 10 years. Environmental, Social, and Governance (ESG) criteria have become a central—and debated—strategy in smart and responsible business. Despite the pros & cons you may have heard regarding ESG — it’s not going anywhere. Investors, stakeholders, and consumers are increasingly scrutinizing how companies address environmental sustainability and human rights, while official, government-enforced ESG regulations continue quickly popping up around the globe.
To meet this rising demand, companies will not only have to get a handle on ESG strategies & reporting, but also do so in a way that helps them withstand the challenges, disruptions, and economic swings affecting modern business around the globe.
ESG Defined
“ESG has really evolved from just corporate sustainability, but it varies from company to company on exactly what it means or looks like. ESG has essentially become a signal that your company has matured and is "with it." Most companies are — simply put — using ESG to communicate the fact that they are being strategic and mindful with how they are running their business." — Dave Stangis, CSO at Apollo
Environmental, Social, and Governance are the three pillars central to measuring a company's sustainability and societal impact. While the term gained prominence in the 2000s, today it is a vital factor for risk management, regulatory compliance, and investment decisions.
- Environmental: Focuses on how a company minimizes its ecological footprint, including its energy use, waste management, and carbon emissions.
- Social: Encompasses labor practices, community relations, and diversity initiatives.
- Governance: Involves corporate policies, internal controls, and leadership structures.
Companies use ESG reporting to communicate their performance in these areas to investors, regulatory bodies, and the general public. Accurate ESG reporting can strengthen corporate reputation, attract investment, and ensure compliance with rapidly evolving regulations.
ESG Reports: Types & Requirements
"At the highest level ESG reporting is both a disclosure document and a storytelling document. What you are trying to do with an ESG report is communicate your environmental, social, governance, performance—being transparent about what you're doing, your successes, but also your gaps, what you're not doing, and what your plan is moving forward.” — Stewart Rassier, Head of Sustainability Strategy at thinkPARALLAX
When developing, tracking, and reporting on ESG strategies, businesses generally produce three types of ESG reports:
- Internal ESG Reports: Used for internal stakeholders, these reports help companies monitor progress and adjust strategies. Internal reports may happen more frequently—monthly or quarterly—to ensure the company stays on track for longer-term ESG commitments. They also prepare the business for more formal regulatory or end-of-year reporting.
- Public End-of-Year ESG Reports: Shared externally with investors, consumers, and regulatory agencies, these reports provide transparency and accountability. They are often designed to showcase the company’s overall ESG performance for the year, highlighting achievements and outlining future goals. These reports are essential for maintaining investor confidence and ensuring compliance with stakeholder expectations.
- Required Regulatory ESG Reports: These reports are mandatory for companies operating in regions or industries where ESG disclosures are required by law. Regulatory ESG reports must adhere to specific frameworks or standards, such as the EU Corporate Sustainability Reporting Directive (CSRD) or the U.S. Securities and Exchange Commission (SEC) disclosure rules. These reports often demand detailed metrics on environmental impact, labor practices, and governance policies, with the goal of ensuring compliance with local and global regulations.
ESG Reporting Frameworks
As you can see, the umbrella of ESG is vast, with each category including numerous ways to track, measure, and report on a company’s impact. To navigate this complexity, third-party organizations have developed ESG reporting standards that help businesses accurately measure and report on their ESG goals, progress, and overall impact. The industry you operate in, your business model, and your specific ESG requirements or goals will determine which reporting framework is most appropriate for your company. Below is an overview of the most commonly used ESG frameworks and when each is typically best suited.
Top ESG Reporting Frameworks
- IFRS Sustainability Disclosure Standards
Developed by the International Financial Reporting Standards (IFRS) Foundation, these standards focus on providing investors and regulators with clear, comparable sustainability information. Ideal for companies looking to integrate financial and non-financial performance metrics into one comprehensive report. IFRS standards are widely used by companies subject to global financial reporting regulations. - Global Reporting Initiative (GRI) Standards
GRI is one of the most widely adopted ESG frameworks, suitable for businesses across all industries. It focuses on a broad range of ESG topics, such as human rights, environmental impact, and governance structures. GRI standards are typically chosen by companies looking for comprehensive, stakeholder-driven reporting on sustainability performance, especially in industries with significant environmental and social impacts. - Task Force on Climate-related Financial Disclosures (TCFD) Recommendations
The TCFD framework focuses specifically on climate-related financial risks. It is designed to help companies disclose the impact of climate change on their business strategy, operations, and financial planning. This framework is particularly useful for industries heavily affected by climate risks, such as energy, agriculture, and manufacturing. - Taskforce on Nature-related Financial Disclosures (TNFD) Recommendations
TNFD is a newer framework that focuses on nature-related risks, encouraging companies to report on biodiversity and ecosystem impacts. As environmental risks extend beyond climate change, TNFD helps businesses account for dependencies and impacts on natural resources, making it essential for sectors like agriculture, forestry, and mining. - European Sustainability Reporting Standards (ESRS)
Part of the EU Corporate Sustainability Reporting Directive (CSRD), ESRS provides a standardized way for companies operating in Europe to disclose sustainability-related information. These standards emphasize compliance with EU regulations, making them vital for businesses looking to align with European sustainability goals and regulatory requirements. - United Nations Sustainable Development Goals (SDG) Standards
The UN SDGs provide a global framework for addressing the world’s most pressing sustainability challenges. Companies can align their ESG initiatives with specific SDGs to demonstrate how their efforts contribute to achieving broader social, economic, and environmental goals. This framework is widely used across industries aiming to showcase global leadership in sustainability. - Sustainability Accounting Standards Board (SASB) Standards
SASB provides industry-specific standards to help companies disclose financially material sustainability information to investors. SASB standards are unique in their focus on financial materiality and are tailored to 77 different industries, making them highly relevant for businesses aiming to link sustainability performance with financial outcomes. This framework is especially useful for publicly traded companies that need to demonstrate the financial relevance of their ESG initiatives to shareholders.
What is ESG Reporting Software?
As businesses expand their ESG efforts, the need for reliable ESG reporting software to both capture & report on ESG data has become evident. While there are many types of ESG software, in a nutshell these tools automate and streamline ESG data collection, analysis, and reporting processes, to ensure accurate and compliant reporting.Types of ESG Reporting SoftwareThere are various types of ESG reporting tools, ranging from single-purpose platforms focused on compliance to integrated solutions that offer insights across the entire supply chain. For supply chain-dependent companies, integrated ESG software/supply chain traceability solutions that tie sustainability data with operational metrics offer a particularly competitive advantage.
- Single-Purpose: typically focused just on ESG data uploads & reporting.
- Integrated Solutions: usually go beyond just ESG data uploads & reporting, expanding to gathering holistic supply chain data & traceability.
Top Characteristics to Look for in ESG Reporting Software
Selecting the right ESG software involves understanding the critical features that will drive success for your business:
1. Customization
Every business has unique ESG goals, especially in industries reliant on complex supply chains. Look for ESG software that can be customized to meet specific needs, from data inputs to reporting templates.
2. Reporting Capabilities
Your software should offer robust reporting functionalities, including the ability to generate reports aligned with multiple ESG frameworks, such as GRI, SASB, and TCFD. Customizable dashboards and visualizations help in analyzing data and presenting insights clearly.
3. Regulatory Compliance
Global regulations around ESG reporting are evolving. A reliable ESG reporting software ensures compliance with frameworks and laws like the EU Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligene Directive (CSDDD) the U.S. Uyghur Forced Labor Prevention Act (UFLPA).
4. Data Management & Integrations
ESG reporting requires collecting vast amounts of data from across your supply chain. Ensure the software can integrate with existing systems like ERP or CRM platforms, making data collection and management seamless.
5. Support & Scalability
Whether you are a small business or a multinational corporation, your ESG software should scale as your business grows. It should also offer support—ranging from user training to technical assistance.
BanQu: Holistic Supply Chain Traceability & ESG Reporting Software
At BanQu, we understand the unique challenges that supply chain-dependent businesses face when it comes to ESG reporting. Our platform goes beyond compliance, helping you multi-solve business pain points by providing real-time traceability, supply chain transparency, and integrated ESG reporting solutions. With BanQu, companies can ensure data integrity, gain actionable insights, and increase resilience in an era of global business uncertainty.BanQu helps businesses:
- Track and report on sustainability efforts in real-time.
- Ensure compliance with multiple global ESG frameworks.
- Gain full visibility into their supply chain to mitigate risks.
Ready to take your ESG reporting and supply chain transparency to the next level? Schedule a Traceability Consult with BanQu today and discover how our solution can transform your ESG strategy.
Discover how ESG reporting software can streamline compliance, enhance supply chain transparency, and support sustainability efforts. Learn how BanQu's integrated solution helps companies report on ESG metrics and increase resilience.