AKA: Eating the Sustainability Elephant One Bite at a Time.
By Richard Pillinger, CFO, EP&T Global
The science is out. The next 10 years are critical. In an effort to limit global temperature increases to 1.5°C, governments and organisations around the globe are setting bold emissions and sustainability targets. This is awesome. We all have a goal. Now we need a plan, because the scale of the transition to Net Zero by 2050 is immense.
Every aspect of our lives will be touched by the sustainability push. Each one of us has something we can do about it – especially my fellow CFOs.
Within any organisation that aspires to achieving Net Zero emissions, CFOs and their teams have a massive influence on how resources are allocated. As such, a big responsibility to making Net Zero a reality sits on their shoulders.
Tracking and Rating ESG performance has never been more important.
The links between ESG (Environmental, Sustainability, Governance), financial performance and improved shareholder returns are becoming more evident and widely acknowledged in the investment and business community. Shareholder returns and financial performance have always been very high on the priority list for CFOs. Net Zero goals have joined that priority list in recent years, as the list of signatures to the CFO Statement of Support can attest.
CFOs are increasingly being tasked to report on not just financial performance, but also non-financial performance. And it is transparency that is key to winning and maintaining the trust of the people you’re reporting to – be they investors, customers or employees. Today, this transparency extends beyond pure financial reporting. Responsible companies are focusing on ESG and bringing transparency to their goals and performance in this area. Companies are setting clear and measurable targets in the areas of energy and water consumption which are often key to the E and S components of ESG, not to mention Net Zero.
All of us at EP&T Global are aware that achieving a Net Zero business isn’t simple. That’s why we’re making it easier for clients to gets some quick and significant emissions reduction results on the board with our technology and solutions.
Operational efficiency is readily achievable. It’s also a cost-effective way to contribute towards financial performance improvements and ESG credentials.
|ESG benefit||Operational efficiency driver|
|Revenue growth opportunities||Operational efficiency can deliver quantifiable reductions in energy and water consumption. (How many times has your company been asked to provide evidence of its environmental policies to a prospective customer?)|
|Cost reductions||Operational efficiency saves energy and water and therefore costs.|
|Access to subsidies and support||Different local and federal governments often have schemes to provide financial support for energy savings projects, including operational efficiency.|
|Attract and retain talent||More and more employees are interested in and motivated by the environmental and sustainability objectives of the company they work for.|
|Asset value optimisation||Improving the sustainability ratings of commercial buildings can increase the value of those assets. An investment in operational efficiency can deliver a very attractive return on investment.|
CFOs are decision makers. Time to make some decisions then. Here are some easy steps to keep in mind.
- Understand what data will be required to report on Net Zero progress
- Establish targets and goals
- Find a balance between outcomes and financial impacts
- Determine how to measure and report on these
There is a solution that will measure performance in energy efficiency, contribute towards Net Zero targets and, very importantly, do this in a way that will actually provide a positive financial return. EP&T Global’s EDGE Intelligent System is a modular technology platform that can be tailored to suit your unique business needs and sustainability goals.
Think of EDGE like an accounting system for your energy consumption. Not only does it record and report where your energy is being expended, it continuously identifies opportunities for you to reduce the amount of energy being consumed.
When I first started my finance career over 20 years ago I never envisaged that it would enable me to contribute towards the global net zero emissions target, but we can all play our part, starting now.
EDGE has a proven track record. It plays a crucial role in building energy optimisation and reporting for over 350 buildings worldwide and counting. Don’t get left behind.
* Source: A Review of the Impact of Green Building Certification on the Cash Flows and Values of Commercial Properties, Department of Built Environment, School of Engineering, Aalto University, Finland, March 2020