According to an article written by Deliogroup, Environmental, Social, and Governance (ESG) policies and reporting a company’s impact on ESG appear to be competitive differentiators. Companies lacking ESG reports are at a disadvantage because stakeholders, investors, consumers, suppliers, and even employees despise operating with businesses and companies without ESG policies. An enterprise with an efficient ESG strategy can benefit from the positive effect on a company’s financial performance, reputation, and risk management.
Privacy and security are key areas to focus on due to the increasing number of companies that believe data privacy is an ESG matter. That perspective is reflected in the case of investors: cyber security is their second most concerning ESG subject, after ethics. Additionally, it’s essential to understand that people are meticulous about the ethical usage and protection of their data, demanding accountability and transparency from companies with whom they do business.
While a firm overview of personal and confidential information should be built in by companies, many jurisdictions have installed laws like the EU’s General Data Protection (GDPR). Thus, the compliance team is obligated to follow regulations set forth and disclose breaches adequately. Including data privacy within compliance has a positive impact on ESG.
Impact on social
Aside from stakeholders constantly searching for more than regulatory compliance, customers and employees prefer to purchase and work for companies that recognize and promote social issues. By exceeding the traditional regulatory compliance measure and including security and privacy metrics in the social portion of ESG guidelines, businesses recognize and pinpoint related issues that are beyond the legislative ground. As a result, transparency and data management are improved, and risks are reduced.
Impact on environmental and governance
Environmental aspects are also positively influenced. By connecting data privacy and security with ESG, companies can evolve in greener ways to gather, process, and store data. This helps lower their carbon footprint. Meanwhile, secure and strong internal data protection and security strategies guarantee authoritative compliance and guarantee stakeholders their data is handled ethically, strengthening governance.
Integrating data security and privacy as part of an ESG strategy is robust in the merits of a corporation’s status, whether it is financial, reputational, or ethical. Going above and beyond is required, and by offering transparency, companies can pinpoint the security and strategies they have in place. This means stakeholders are well-informed when considering an investment.
HOBI’s value-added IT asset disposition (vITAD) services provide ESG value for our clients by including Scope 3 GHG reporting to our clients. IT asset disposition is expanding beyond the traditional model of reverse logistics, data erasure, remarketing, and recycling. ESG reporting now requires table stakes and should be a primary consideration when selecting an ITAD service provider. For more information about our vITAD services, including our ESG reporting model, call 817-814-2620 or contact HOBI at sales@hobi.com.