The business-insight gap

For business executives, there is no path forward that doesn’t have sustainability as a core tenet. Sustainability remains one of the highest business priorities for executives, no matter the industry in which they work.

As such, every leader in business has also effectively become an environmental, social and governance (ESG) decision maker, from the CEO on down. The situations differ, but for each leader, the importance remains high. This is the case, for example, for CFOs seeking capital from ESG fund managers, chief people officers promoting workforce diversity, and logistics leaders improving environmental compliance across supply chains.

Addressing new regulations and reporting on corporate progress is not easy. The sustainability efforts we undertake must align with our core business purpose, and the ESG reporting we do must accurately and clearly reflect our commitment to progress. Yet it is no small task to mine the array of corporate systems for relevant data; to marry these disparate data sources to develop pertinent insights and devise impactful sustainability initiatives; and finally, to produce effective disclosures. To do all this, we must coalesce what brings value to the organisation and what the organisation values.


ESG: The business insight gap

Yet the efforts of many organisations are hindered because they lack the real-time, analytical data and deep insights required to make effective decisions. This ESG void subverts the ability to address outcomes and business performance in tandem.

Traditional ESG reporting remains lamentably slow, regulatory driven and backward-looking. It fails to give the targeted, dynamic picture that business leaders need to deliver improved ESG outcomes for business and society. Many areas of firms’ extended supply chains remain terra incognita for ESG measurement, with limited tools to capture carbon emissions embedded in upstream or downstream sectors, or trace and verify compliance with labor, ethical and other ESG standards.

Four key factors underlie the ESG–business insight disconnect: data gaps or inconsistencies; combined or compounded metrics; data lag; and poor understanding of the causation pathways between ESG metrics and management performance. There is an urgency for companies to address these issues. Businesses will increasingly face pressures including new regulations, increased stakeholder screening and greater competition from businesses more skilled at manipulating the ESG data chain — and capturing more revenue, as a result.

DXC curated the perspectives of ESG executives, experts and thought leaders to help us shed light on how improved data strategies and next-generation technologies might play a role in providing meaningful, actionable insight to help reach ESG goals and encourage wider business commitment to ESG initiatives.