A couple of weeks later, Rutherford Cross’ Will Dodds reflects on a successful roundtable breakfast event where he welcomed a range of CFOs and Senior Finance leaders from across Scotland to discuss the challenges businesses are facing from an ESG and Sustainability perspective.
ESG – usually defined as Environmental, Social and Governance – was in this instance defined as the Edinburgh Sustainability Gathering!
There were a lot of talking points raised by all, including economic challenges and the impact finance teams have on ESG strategies (both internally and externally), as well as the changing landscape of the ICAS syllabus with the introduction of sustainability courses.
Economic Challenges
Attendees around the table came from a range of industry backgrounds and were able to share lots of interesting initiatives. We found that those from FMCG or product-led businesses are focused on the pressure to produce sustainably: a pressing need from an ESG perspective; however, implementation often requires large upfront capital injection, resulting in high costs.
With the cost of living where it is, customers will still (more often that not) choose the cheaper alternatives when purchasing products from the shops. To add to this, costs are constantly being squeezed by the big supermarkets which is having a knock-on effect on the wider brand offering available when selling their products.
Finance Team
Finance Teams are becoming more involved than ever in the reporting surrounding ESG and Sustainability. This can be carbon footprint, ESG impact, and how this affects business performance. It was interesting to hear differing views on how companies are raising the continued issues on ESG, and how they have set up committees to lead conversations – almost always with finance as a spearhead.
A couple of businesses are also creating roles within finance in the form of a Sustainability Analyst to build on these reports and present to senior stakeholders about achieving company objectives.
New Standards
There are a number of new standards being incorporated into reports which again are heavily weighted towards a finance team’s reports. Interestingly, ICAS (The Institute of Chartered Accountants of Scotland) is introducing a number of sustainability / ESG focused courses that will be incorporated into the wider syllabus, making this a part of everyday life for the future accountant.
Technology
There’s been a significant rise in the development and adoption of standards and systems to assist companies in achieving their ESG and sustainability goals. These frameworks offer structured approaches to measure, report and improve ESG performance, aiding companies in aligning their strategies with global sustainability objectives: something a lot of attendees around the table are looking to implement, including the use of dashboards etc.
This reporting allows companies to enhance their credibility, transparency and accountability regarding their ESG commitments.
Looking to the Future
Although we could have talked for a lot longer about the challenges we are all facing, it is promising to see that there is a proactive need for companies to get ahead when looking at ESG and Sustainable strategies. These can also be used as a talent attraction tool when looking to bring in the best people to help with business growth. It is clear that senior stakeholders are putting more pressure on colleagues to constantly think about ESG and sustainability from a business perspective, but also how it can effect business performance positively.
It is no surprise that these topics are poised to become even more ingrained in the fabric of finance. They will not only drive investment decisions but also influence risk assessment, corporate governance practices, and stakeholder engagement strategies within the wider organisation. Awareness is increasing, and companies are constantly under the spotlight for what they can do better. It is also nice to hear this is being incorporated into day-to-day life for many outside of work; proactively changing their behaviours to become more sustainable.
We are looking forward to hosting future sustainability gatherings in the capital, so please do not hesitate to reach out if you would like to be a part of the next instalment: [email protected].
