With new mandatory climate-related financial disclosure standards just introduced in Australia, compliance will be at the top of the agenda for many business leaders. Technology can not only help simplify and streamline reporting but reveal sources of untapped financial, social and environmental value for organisations. In this article, we look at how to use technology to your advantage, drawing from insights in PwC’s latest report ‘Hidden opportunities: Creating value through climate action.’
1. Use technology wisely
Sustainability information must be available, accurate and ready for assurance. Targeted technology investment, building on existing financial, ERP and other systems and leveraging AI, is essential for achieving efficient ongoing reporting. This also ensures data is integrated into decision-making processes across the organisation.
Look for technology products that:
- Allow seamless data extraction from varied sources and easy sharing functionality
- Turn data into insights - converts raw data into emission profiles, from activity data and emission factors to final emissions outcome
- Have a friendly user interface that can be shared with any stakeholder
- Leverage AI to cut down on manual processes and improve quick access to insights
- Include forecasting and simulation for strategy and planning
- Plan and monitor performance against the targets
PwC’s Unified Sustainability Hub is one way to accelerate sustainability initiatives through technology.
2. Check your data and perform a gap analysis
One thing that we can learn from our European peers who are navigating the Corporate Sustainability Reporting Directive (CSRD) is that data availability and quality are the biggest obstacles to implementation.
Much of the information required by the Australian Sustainability Reporting Standards does not exist today in companies’ enterprise resource planning (ERP) and other central source systems. It will likely be tracked down manually from spreadsheets and original documents (e.g., invoices) that are distributed across the business. This is a recipe for inefficient and error-prone processes. Companies need to pay close attention to the fundamentals of data strategy — how sustainability data is defined, sourced, governed and processed. This needs to happen quickly as this will be assured going forward.
3. Consider advanced technologies for your supply chain
To navigate global supply shocks, AI-enabled “control towers”— connected dashboards of data, key business metrics and events personalised to decision-makers across the supply chain can be indispensable. These help to understand, prioritise and resolve critical issues in real-time — for example, when circumstances require temporarily shifting sourcing from one part of a supply network to another.
Anticipated supply chain cost reductions of 19% and revenue gains of 16% are expected by supply chain ‘champions’ who have implemented priority technologies and capabilities.
Technology helps identify sources of value
Technology enables a feedback loop. It can inform ongoing sustainability efforts and operational improvements. This feedback loop allows you to identify areas for improvement and adapt strategies accordingly.
Technology enables accuracy and compliant reporting. These reports will equip investors with more transparent, consistent and comparable data. We expect many will use this data to value companies, rewarding those that articulate a compelling narrative about how they will compete amid sustainability-driven market forces.
Some may view the new reporting requirements in Australia as a burden, but the findings from our Global CSRD Survey 2024 suggest a different perspective. Approximately one-third of survey participants expect that CSRD implementation will directly lead to revenue growth and cost savings. So instead of focusing solely on the challenges, ask yourself: how can our business use climate reporting to spur innovation and open up new market opportunities? Help build trust and attract new customers? Attract favourable finance? This is all possible while contributing positively to the environment and society.
Looking ahead
As global sustainability standards tighten and new regulations emerge, those who act now will lead the way in a fast-changing market. Leaders are shifting from a compliance mindset to focusing on growth potential instead. Using technology can boost progress.
Read and download the full report. Contact Jon Chadwick or Caroline Mara to find out how you can create value for your organisation through sustainability and climate action.
