For businesses, the pressure to achieve environmental, social and governance (ESG) success intensifies by the day. While compliance has always been important to a company’s stakeholders, ESG goals—particularly those that seek to reduce a company’s carbon footprint—are now equally important.

Improving ESG performance is a complex challenge. But as demonstrated by three Sphera customers—Colgate-Palmolive, Arcadis and Estée Lauder—the journey to ESG leadership is achievable with the right strategies and tools. In this blog, we look at how these industry leaders have used data and technology to establish baselines, identify hotspots, set targets and successfully navigate a dynamic business environment to reach their goals.

GlossaryWhat Is ESG Reporting, and Why Is It Important?
ESG reporting refers to the disclosure of data covering a company’s operations in three areas: environmental, social & corporate governance.

Colgate-Palmolive: Setting Goals and Meeting Targets

An $18-billion-dollar company selling in 200 countries worldwide, Colgate-Palmolive is one of the most recognizable names in consumer products today. And with four core product verticals spanning personal care to pet products, the company embraces its responsibility to improve the lives of its customers both in terms of product quality and sustainability. A comprehensive strategy and sophisticated technology are enabling Colgate-Palmolive to meet this responsibility.

The company’s ESG operations are built on a multi-point approach underpinned by three key pillars: driving social impact, helping millions of homes and preserving the environment. This strategy includes objectives ranging from eliminating plastic waste to promoting inclusivity in its markets worldwide, requiring Colgate-Palmolive to gather data and track a comprehensive set of KPIs to ensure progress is made. In particular, data-driven technology is helping the business make significant progress toward its 2040 net-zero goals by enabling the company to evaluate its carbon footprint on a granular level. As a result, Colgate-Palmolive is on track to slash greenhouse gas (GHG) emissions from purchased goods by 20% (from 2020 levels) by 2025, hit 100% renewable energy use by 2030 and meet—or exceed—many other ambitious emissions targets. This success couldn’t be achieved without the proper oversight and the use of accurate measurement tools.

Arcadis: Tackling Emissions Challenges

A powerhouse in the world of sustainable design, consulting and engineering, Arcadis tackles over 40,000 client projects every year, ranging from accelerating EV charging infrastructure growth to designing flood-resistant ports. Living the values it preaches, Arcadis has set aggressive, wide-ranging goals focused on tackling emissions: The company aims to hit net zero and switch to an entirely electric vehicle fleet by 2030, and it plans to reduce workforce travel by 35% by 2025. Efforts such as these have led to numerous sustainability awards and recognitions for Arcadis—including an A rating from the CDP—and have firmly established the company as a leader in sustainable business. To get to this point, the company had to take a long-term, tech-driven view.

In 2000, when the company first measured its carbon footprint, Arcadis relied solely on manual processes to calculate and track its GHG emissions and sustainability activities. Recognizing the increased likelihood of data errors, security and accessibility challenges and other operational issues, Arcadis adopted a corporate sustainability software platform in 2021. This digital transformation initiative allowed Arcadis to bolster the efficiency of its internal sustainability operations. It also helped the company expand its sustainability reporting to include Scope 3 emissions and provided a more detailed view of its progress. The company continues to grow its data capabilities and added 160 new performance indicators in 2022 alone. Currently, Arcadis is in the process of incorporating additional enhancements that will help integrate recently acquired companies into its sustainability activity for end-to-end visibility.

Estée Lauder: The Importance of Documentation and Processes

With products available in approximately 150 countries, Estée Lauder is one of the most widely recognized names in skincare, makeup, fragrance and haircare. Dedicated to ESG excellence, the company has been on a continuous journey to optimize its ESG reporting, performance and efficiency. As ESG regulations have proliferated and requirements have become more stringent, the organization has adopted an approach to ESG disclosures that’s built on a solid foundation of documentation, processes and technology.

Clear procedures and documentation for data collection, validation and review processes have been instrumental in building the company’s reporting capabilities, as they have allowed Estée Lauder to collect data in a repeatable and reliable way. This gives the company’s sustainability leaders confidence that the data they collect and eventually provide to external stakeholders is consistent and accurate, which are qualities that are also valued by auditors.

Estée Lauder’s reporting success also comes from their practice of bringing internal business partners, data owners and subject matter experts along as key partners on their ESG journey. Additionally, the company uses an internal review process that ladders up to senior managers, so they are comfortable with their ESG disclosures and can provide final approval before external disclosures are made.

To learn more about these ESG success stories, view the keynote session from the 2023 Sphera ESG Virtual Summit.

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