What is your ESG rating? The current Environmental, Social and Corporate Governance (ESG) criteria.
What is your ESG rating? The current Environmental, Social and Corporate Governance (ESG) criteria.

What is your ESG rating? The current Environmental, Social and Corporate Governance (ESG) criteria.

The topic of “sustainability” is currently on everyone’s lips and will become of increasing importance to us all in the years to come.

Companies, especially Small & Medium sized Enterprises (SME’s), are strongly advised to develop a plan today, because it is becoming increasingly important for all organisations to define sustainability strategies and establish sustainability management systems – irrespective of their size.

Listed companies must already report in an integrated manner from this year (2023), i.e. they must disclose their ESG risks as well as the taxonomy-compliant shares of sales, operating expenses (OPEX) and capital expenditures (CAPEX) and it can be assumed that this obligation will be extended to SME’s in the not too distant future.

The three pillars of sustainability, i.e. Environment, Social and Governance, must be taken into equal account when creating the sustainability strategy for an organisation.

Sustainability goals must be defined individually from each of the three ESG areas, as well as creating suitable sustainability indicators. ESG goals can relate to energy management and resource use in the environmental area. You can focus on internal and external effects on people in the social area and on ethically and morally impeccable behaviour in the area of responsible corporate management.

A transformation plan should then describe how, with which measures and by when these goals will be implemented as well as how individual transformation risks will be identified and evaluated.

Photo of Michael Gutowski
Michael Gutowski – Managing Partner

The company’s declared goal is to become sustainable and compliant with the Sustainable Development Goals (SDGs) of the UN and the EU taxonomy.

With the taxonomy, the EU has created an instrument to evaluate corporate activities in terms of their sustainability. To be compliant, the individual activity must contribute to one of the six EU environmental goals and not have an adverse impact on any of the other goals.

A sustainable (i.e. EU taxonomy-compliant) company receives a correspondingly good ESG rating. The better the ESG rating, the better the financing conditions and contributions will be in the future, and only with a corresponding minimum rating will companies be able to gain access to public contracts and ensure the maintenance of their business relationships.

Consequently, it is not difficult to imagine what will happen to unsustainable, non-taxonomy-compliant companies in the future!

When properly implemented, sustainability is an instrument for reducing risk and securing long-term opportunities for the organisation. Therefore, due to its importance, it is the responsibility of top management and every supervisory board to make sustainability one of its main tasks.

Photo of Gary Milner
Gary Milner – Managing Partner

At gutowski & milner  we have extensive real-life experience in developing these strategies with our clients and are available to talk this through and help you develop an approach that works for your organisation. Please feel free to contact us at gutowski & milner for more details.