A responsible approach to the environment, resources, and employees, summarized under the term ESG (environmental, social, and governance), is no longer a nice-to-have for companies. Proof of commitment in this regard plays an increasingly important role when it comes to orders, while reporting errors and incorrect implementation can result in severe penalties. In this blog post, you will learn why it’s not just the environment that benefits from sustainable production methods – and find out how companies can collect and use ESG data from all departments.
ESG is the key to a more sustainable industry
In a modern manufacturing company, countless ESG-related data points are created every day along the entire value chain – on the factory floor as well as in the individual departments. If a sufficient amount of quality data is available, it can play a key role in bringing about a sustainable industrial transformation if used correctly. After all, when such data is amalgamated, it produces a comprehensive digital overview of numerous processes and indicators, from energy consumption and emissions to waste generation and disposal. This transparency creates the basis for targeted measures aimed at raising efficiency – helping the environment and also bringing clear benefits to companies.
Benefit 1: Leaner processes
The use of modern technology in Industrial Internet of Things (IIoT) solutions and AI-powered analytics capture ESG data and create a digital twin of the entire supply chain. This not only enables companies to adapt existing processes in real time, but also make forecasts to identify recurring disruptive factors, resulting in constantly optimized processes, less waste, and sustainable use of resources.
Benefit 2: Reduced scope 3 emissions
ESG also plays a role outside the production hall – when it comes to scope 3 emissions, for instance. These indirect greenhouse gas emissions are generated by extracting raw materials, for example, or by services that a company purchases. They are therefore part of the value chain, but can only be controlled indirectly by the company. A consolidated data set can help to reduce these emissions by improving the selection and coordination of all players involved in the overall process.
Benefit 3: Simpler ESG reporting
ESG reporting is becoming increasingly important. In addition to legal requirements such as the EU’s Corporate Sustainability Responsibility Directive (CSRD), investors and customers also demand proof of responsible business activities. This makes it all the more important for a company to be transparent about its own commitment to sustainable production and management. Companies that hold ESG data can use the right tools to quickly and seamlessly show the impact their activities have on the environment, employees, and society – and take appropriate measures based on this.
Benefit 4: Better risk management
There is another advantage to having an all-round view of the relevant production processes: ESG data can be used to make sound forecasts for effective risk management, a process that identifies potential imponderables and evaluates their likelihood of occurring before providing clear recommended courses of action. This not only improves sustainability, but ultimately also the resilience of the entire value chain.
Greater sustainability among SME manufacturers – with Syntax
Sustainability is not an end in itself. In order to save resources and increase efficiency, companies need a partner by their side who is familiar with both the technological aspects and the industry-specific business processes. As an IT service provider with decades of experience, we at Syntax know the special requirements of industrial SMEs. Together with IT managers and individual departments, we help companies to optimize their processes from top floor to shop floor. Contact our experts to get the most out of your ESG data.
Learn about the specific steps your company needs to take to seamlessly integrate ESG data from management to production in one of our upcoming blog posts.
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