A recent study by KPMG US found that many companies are trying to improve their sustainability reporting. However, about half of these companies still use basic spreadsheets to manage their ESG activities. While this is happening, pressure for businesses to become more eco-friendly and socially responsible is also increasing. The KPMG survey, given to 550 leaders in primarily European companies, showed a large gap between what companies think they are doing well and what they're doing regarding ESG reporting. Is this correlation connected to the type of software used, and if so, why are spreadsheets unsuitable for monitoring sustainability activities?
ESG and spreadsheets: the problems
Despite 90% of surveyed companies planning to increase their ESG investments in the coming years, the prevalent use of spreadsheets highlights a critical inefficiency.Excel, and similar spreadsheet applications, are tools that are not originally designed for complex sustainability data management. Although versatile in their usage, these tools have proven to fall short in handling large amounts of nuanced ESG data. For instance, organising this type of data in spreadsheets can lead to inaccuracies in reporting and data silos, which ultimately hinders the development of a competent sustainability strategy. This dependence on spreadsheets not only correlates to a disconnection between companies' perceived and actual ESG reporting but also reflects the broader challenges in scaling up ESG efforts effectively.
Why It Matters for Small and Medium Businesses (SMEs)
This study's findings are important for smaller businesses as these are often subjected to the questions of resource allocation. As a result, there are multiple benefits for SMEs to use a specialised ESG platform instead of a traditional spreadsheet approach.
- Better accuracy and efficiency: whereas spreadsheets are prone to human errors, specialised ESG platforms make gathering and managing ESG data much simpler.
- Meeting rules and regulations: Specialised platforms help businesses stay on top of the latest requirements for reporting ESG correctly.
- Growth friendly: These systems can grow with your business, unlike spreadsheets.
- Builds trust: Accurate ESG reporting makes your business attractive to investors, customers, and other possible stakeholders.
- Helps in making better decisions: These platforms do more than just data collection; they analyse it to help you make smarter sustainability choices.
In addition to the previously mentioned challenges; using spreadsheets for sustainability data can be risky. They don't have strong security measures like specialised ESG platforms. This means that they are more vulnerable to unauthorised access or data breaches. Small businesses, which might not have dedicated IT help, are especially at risk. Switching to ESG platforms not only helps with accuracy and efficiency but also keeps data safer, protecting businesses from cyber threats and compliance issues.
Getting Started for SMEs
For SMEs wanting to make the transition from spreadsheets to a more efficient way of managing ESG data, here's how to start:
- Identify what you need: Look at your current ESG data management and figure out what needs to be improved.
- Look at your options: Check out different ESG platforms, especially those designed for SMEs. Think about what's easy to use, scalable, and fits within your budget.
- Try it out: Start with a small test of the platform to see how it fits into your specific business model.
- Train your team: Make sure your team can utilise the platform to its full potential.
- Keep improving: Use what you learn from the platform to keep improving upon your sustainability efforts.
Choosing a specialised ESG platform is a key component for SMEs wanting to improve their sustainability strategies. Moving away from spreadsheets helps SMEs manage their ESG data more efficiently while simultaneously showing that they are a responsible and forward-thinking company.
About Eevery
Eevery is a fast-evolving startup dedicated to driving sustainability in the SME sector. Our platform, focused on intelligence and automation, assists businesses in measuring, improving, and communicating their sustainability initiatives. With a strong presence in the European and UK markets, Eevery is rapidly becoming the preferred solution for SMEs looking to embrace sustainable practices.
