ESG reporting software has emerged as a critical element of corporate transparency, allowing companies to demonstrate their commitment to sustainable practices, manage risks, and foster stakeholder trust. To effectively track and report on environmental emissions, organizations require a holistic approach that encompasses technology, frameworks, and people. OneStream, an innovative financial consolidation and reporting platform, offers a comprehensive solution to streamline ESG reporting processes and enhance sustainability efforts. This article explores how OneStream can facilitate ESG reporting, highlighting its key features and capabilities.
What is ESG Reporting and Why is it Important?
Environmental Social & Governance (ESG) reporting has become an integral aspect of corporate transparency, reflecting companies' commitment to sustainability, risk management, and stakeholder engagement. Furthermore, organizations that prioritize ESG performance often exhibit long-term outperformance compared to their peers, positioning themselves for sustainable growth and resilience in an evolving market landscape.
In the United States, the significance of sustainability is being increasingly recognized, leading to the demand for standardized ESG disclosures. While ESG reporting currently remains voluntary, forthcoming SEC ESG disclosure requirements are expected to shape reporting practices further. Although the finalization and implementation timeline for these regulations have been delayed, it is anticipated that they will be enacted in 2023. Consequently, companies are actively seeking ways to gather accurate ESG data, quantify their impact, and report transparently on their sustainability initiatives.
Some common challenges with ESG data today include limited policies, procedures and governance, no controls or established governance framework, and highly manual processes/information flow (disparate data sources and offline spreadsheets, and data issues addressed as ad-hoc).
To effectively address the complexities of ESG reporting software, companies require a holistic approach that combines technology, a framework component for how to use the technology, as well as a people component to make sure the ESG data framework is being followed. From a technology perspective, spreadsheets are the most widely used tool to capture, calculate and report on ESG data today. This is where we see the potential of systems like OneStream, a comprehensive financial consolidation and reporting platform which offers a range of features and capabilities designed to streamline and enhance ESG reporting processes. This is a system where financial data already exists along with the ability to do custom calculations, connect to other systems to pull in pertinent data, and create customized reports for SEC reporting, as well as conduct ad hoc analysis to plan for future emissions targets. OneStream can also enable proper audit trail for ESG reporting.
OneStream's Role in Facilitating ESG Reporting Software:
- Data Integration and Consolidation: OneStream enables organizations to collect data from various sources, including ERP systems, spreadsheets, and external ESG data providers, and consolidate it into a unified platform. This streamlines data collection, eliminates manual processes, and reduces errors, saving valuable time.
- Flexible Reporting and Analytics: OneStream's robust reporting and analytics capabilities empower organizations to create customized ESG reports and dashboards. Stakeholders gain real-time access to ESG performance data, enabling them to make informed decisions based on accurate and up-to-date information.
- Auditability and Data Governance: OneStream ensures data integrity and transparency through its built-in audit trail and data governance features. This instills confidence in stakeholders, assuring them that ESG data is reliable and can withstand scrutiny.
- Workflow Automation: OneStream automates workflows and approval processes, facilitating collaboration and ensuring consistency in ESG reporting across the organization. This reduces administrative burdens, improves efficiency, and strengthens data accuracy.
Measuring Emissions with OneStream:
OneStream helps companies accurately measure and report emissions across various areas. Some crucial data points that companies look to report on today include business travel emissions, utility emissions and fleet vehicle emissions.
- Measuring Emissions from Business Travel: Business travel represents a significant source of carbon emissions for many organizations. To accurately measure and report on business travel, OneStream can integrate with systems such as Concur, a popular travel and expense management platform. By connecting to Concur, OneStream can capture relevant data, including emissions per flight, distances traveled, and modes of transportation. This integration enables organizations to calculate and track their carbon footprint associated with business travel, facilitating ESG reporting and analysis. Other travel systems might not have the capability to produce such data on emissions or convert to an appropriate measurement unit. OneStream can help overcome this gap by utilizing custom calculations and financial data already built into the system.
- Measuring Emissions from Utility Bills (Scope 1 and 2): ESG reporting often requires organizations to measure and report their greenhouse gas emissions produced by Scope 1 and Scope 2 utilities. OneStream can assist companies in measuring Scope 1 and Scope 2 emissions from utility bills, by integrating with utility billing systems to automatically retrieve data such as energy consumption, fuel usage, and associated emissions. Additionally, OneStream can support the conversion of these emissions into appropriate units, calculating emissions within the system and ensuring compliance with reporting frameworks and standards. OneStream can also enable drill back into utility bill attachments within the system for audit purposes.
- Measuring Emissions from Fleet Vehicles: OneStream provides mechanisms to accurately measure fleet vehicle emissions by integrating with fleet management systems which can be very complex. It captures data such as mileage, fuel consumption, and vehicle types, and can utilize technologies like telematics for real-time monitoring of fleet performance, including emissions. Furthermore, by integrating with systems that capture gas receipts, such as fuel card providers or expense management platforms, OneStream enables the inclusion of this data in the reporting system.
ESG reporting is becoming increasingly vital for companies to demonstrate their commitment to sustainability, manage risks, and build stakeholder trust. However, organizations often face challenges in gathering, consolidating, and reporting accurate ESG data. OneStream, a comprehensive financial consolidation, and reporting platform, offers a robust solution to streamline ESG reporting processes and enhance transparency and sustainability efforts.
By integrating data from various sources, such as ERP systems, spreadsheets, and external ESG data providers and sources like Concur, OneStream simplifies data collection and eliminates manual processes, reducing errors and saving time. This integration also enables accurate tracking, calculation, and reporting of emissions, helping companies fulfill their ESG reporting requirements and set sustainability targets. Its flexible reporting and analytics capabilities empower organizations to create customized ESG reports and dashboards, providing stakeholders with real-time access to accurate information for informed decision-making.
OneStream's built-in audit trail and data governance features ensure data integrity and transparency, instilling confidence in stakeholders and reinforcing the reliability of ESG data. Additionally, workflow automation and approval processes enhance collaboration, consistency, and efficiency in ESG reporting across the organization.
In conclusion, OneStream provides organizations with a comprehensive solution to streamline ESG reporting processes, enhance transparency, and drive sustainability. By leveraging the platform's capabilities, companies can effectively navigate the complexities of ESG reporting, improve data accuracy, and position themselves as leaders in sustainable practices, gaining a competitive advantage in an evolving market landscape and preparing themselves to align with the looming SEC disclosure requirements in the US.
Citations & Sources:
https://www.onestream.com/blog/recap-incorporating-esg-across-your-organization/
Matthew Rinegar, Senior Corporate Counsel, iCertis Inc. (formerly Senior Corporate Counsel at Schlumberger Ltd and US Silica and Sr. Associate at Latham and Watkins)
