Environmental, social, and corporate governance (ESG) needs to be at the centre of our digital transformation strategies.
Technology and ethics need to go hand-in-hand. There is an increasing push across global industries to incorporate ethics and sustainability into business practices. When implementing digital transformation, we need to put ESG first.
Here’s how companies can move towards ESG reporting with ease.
ESG and tech – an unlikely partnership
Often, tech is viewed as the antithesis to ESG. Technology can too often have a negative impact on the environment, whether in mining, power, or harmful chemicals.
Fortunately, the reality is quite different. Through implementing digital transformation, companies can adopt technology that supports renewable energy, tracks ethics in supply chains and across business, and overall reduces a business’ impact on the environment.
Globally, companies are facing pressure from stakeholders, investors, and consumers to move towards greener practices. Getting started early can help businesses be ready for the future, while also improving their client diversity and improving client reputation.
While in many sectors and countries sustainability reporting is voluntary, it’s quickly becoming a necessity for many ESG-focused consumers.
Sectors that face increasing scrutiny
The mining and resources sector is one that is at the centre of ESG focus. While others face scrutiny – for example clothing manufacture and food – mining is especially vulnerable to ESG violations and, as a result, often faces widespread attention. This is largely because mining takes place in a high-risk environment with a variety of EH&S issues and potential impact on local communities.
In many cases, mining operations might offer a steady – if temporary – source of income for local communities and this can offer both pros and cons. On the positive side, this can bring income and development for poor communities.
On the negative, communities often become reliant on this income and are forced back into worse poverty when the mining operation ends. In addition, some miners might engage conflict and child labour, exploiting and underpaying workers. Often, those sourcing these minerals are unaware.
Through improved digital transformation strategies, we can implement tech that will track, mitigate and identify issues of ESG violations within supply chains, particularly in mining. Blockhead Technologies have created STAMP Supply, a blockchain-enabled platform that tracks your data throughout the supply chain and helps you to identify abnormalities.
Blockchain should be a key part of business innovation in the ESG sector. It provides a reliable, immutable and secure method of data recording that can provide companies with a trustworthy dataset, which they can then utilise to support their ESG policies.
Other advanced tech, such as artificial intelligence and machine learning, can collect, deliver and analyse data for increased performance and identification of issues in the supply chain. It can also help to forecast and mitigate risks, identifying opportunities for improvement and optimised productivity.
As many companies move towards prioritising ESG, they should acknowledge the role it will place in their digital strategies.