There’s more to ESG than meets the eye

While companies and organizations around the world are including ESG in their strategic business agenda, there is still plenty of room for improvement when it comes to turning the well-meaning acronym into tangible action.

TEXT: TIMO MANSIKKA-AHO

According to Tiina Antturi, SAP’s Head of Sustainability, Nordics and Baltics, especially the middle letter S is far too often neglected. Social responsibility is an effective, yet still very underrated investment in economic growth.

“Reducing inequality, for example, is a powerful way to support overall business operations”, Antturi explains. “Inequality affects business performance, limits productivity and innovation, disrupts the distribution chain and weakens the general trust.”

Antturi has worked for development co-operation organizations and personally visited refugee camps, slums and dumping grounds – places and living environments where people do not have a choice or an opportunity to fight for their human rights. She says that is precisely why companies who are able to ask all the right questions should place social responsibility right at the core of their culture.

The time for that is now, with modern technology enabling visibility throughout a com- pany’s value chains. The rapid development of block chain technologies and artificial intelligence embedded in Enterprise Resource Planning (ERP), Supply Chain Management, Sourcing and Procurement systems are examples of the latest tools that make tracking the fulfilment of social responsibility ever more visible.

Social responsibility through modern technology

“Advanced technology makes tracking the real situation a lot more effective and reliable”, Tiina Antturi points out. “Challenging decision-makers with questions about issues such as equal pay, injury risk, social treatment, child labor and healthcare, and then reporting the situation throughout the value chain improves human rights and well-being accordingly.”

Any company is only as stable as the ecosystems, societies, and economies where they operate. Uncertainties in supply chains and general operating environment create immediate risks and make long-term strategic planning difficult. As the overall uncertainty continues and dramatic incidents tend to follow one another, being on top of things is even more essential. Recognizing the various ways to block the risks caused by increasing inequality and taking sufficient action to remove them are excellent ways to support social responsibility.

By enabling measurement and transparency, today’s technologies and systems work efficiently also for human rights. Now, it is up to companies and organizations to start asking the right questions and participate in and support the right value chains. |

Read more at
sap.com/sustainability
and sap.com/finland