The Diligent ESG platform is designed to help organizations more efficiently, effectively and accurately collect environmental, social and governance (ESG) data and report progress against internal goals and external frameworks. The platform also offers flexibility in the depth and breadth of ESG reporting as a business and its sustainability programs grow — expanding from Scope 1 and 2 to Scope 3 emissions reporting, for example.
With Diligent ESG, automation and data pre-population simplify the collection, aggregation and validation of energy usage data. Dynamic reporting and platform integration streamline the creation of regulatory and sustainability reports, with an automatic audit trail. Carbon accounting functionality automatically converts energy usage data into CO2 equivalents for GHG reporting, and standards mapping and benchmarking enable organizations to track progress against goals.
Diligent recently commissioned global research and advisory company Forrester to develop a Total Economic Impact (TEI) study analyzing the Diligent ESG solution along with four others: Diligent Boards, Diligent Entities, Diligent Risk and Diligent Compliance. How well does Diligent ESG help organizations save time and money while keeping up with escalating demands on ESG disclosures? What are the benefits, costs and risks of this investment?
Read on for answers to these questions and key takeaways from the Diligent ESG TEI Report.
Background and Business Challenge
In lieu of a specialized platform like Diligent ESG, organizations have typically shared ESG data with investors and business leaders in two ways: by creating their own data collection and reporting systems in-house or by working across a series of spreadsheets. Both options require significant amounts of manual labor, generating findings that are difficult to audit, with limited data transparency. Such limitations hinder an organization’s ability to accurately report emissions and form energy reduction strategies as the business grows.
“The biggest challenge becomes data quality and integrity, because spreadsheets aren’t a great auditable system.”
Group head of sustainability interviewed for the TEI report
Streamlining Sustainability Across Multisector Operations
For this report, Forrester interviewed two group heads of sustainability with experience using Diligent ESG. The study extrapolates their experiences into a hypothetical 15,000-employeee company with a variety of ESG complexities — not the least being 35-plus businesses across the healthcare, technology and energy sectors.
Based on their familiarity with ESG oversight and reporting, the two interviewees sought a solution that would reduce manual labor — particularly in the tasks required for collecting, validating and aggregating energy usage data. Their solution would also allow teams to more efficiently complete and then file reports to regulators and other sustainability stakeholders. An ideal solution would be scalable across business environments, with a transparent view and assurance of data quality throughout.
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By modeling benefits and costs over three years, Diligent ESG enabled the hypothetical company in the TEI study to:
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The Quantified Benefits
In the areas of ESG data collection, validation and reporting, time is money. Diligent ESG enabled interviewees to save significant amounts of both.
By integrating directly with meter data from the company’s many businesses, Diligent ESG automated much of the collection process. Automation also meant fewer risks of data input errors and less manual review. Interviewees estimated that without Diligent ESG, using manual tasks across disparate spreadsheets and systems, data collection, validation and sharing would have required the equivalent of four full-time employees.
All in all, the organization reported a three-year, risk-adjusted total present value savings of over $156,000. As an additional perk, more streamlined data collection meant that the sustainability team was better equipped to deliver high-level insights to business leaders — unearthing further savings across the organization’s businesses around energy costs.
Farther along in the process, Diligent ESG made it more efficient to complete and file reports for regulators, as well as reports for standalone ESG disclosures and investor events — resulting in time savings of between 20% and 40% overall. As an added plus for the time-strapped sustainability team, much of the time savings occurred before the end of the fiscal year, during the time-crunched period when regulatory reports are due.
“We’ve completed [reporting] within 28 days after year-end. It’s a pretty impressive turnaround, and I’d have to say would be absolutely impossible without something like [Diligent ESG].”
Group head of sustainability interviewed for the TEI report
Finally, auditing ESG data had been a time-consuming and cost-intensive process under the organization’s previous set-up of spreadsheets and in-house systems, with outside auditing firms incurring extra fees for tasks like sorting through and matching up data across spreadsheets, for example. By providing relevant data all in one place, interviewees estimated that Diligent ESG trimmed at least 50% from outside auditing expenses. Furthermore, the platform generated fewer errors during the data collection and aggregation process, trimming the audit firm’s scope of work, and price tag, even more.
Including the audit savings plus the time savings mentioned above for report generation, the organization’s investment in Diligent ESG resulted in a three-year, risk-adjusted total present value savings of over $122,000.
The Unquantified Benefits
Several other benefits didn’t translate as directly into dollars but provided value nonetheless, starting with increased transparency. With spreadsheets and internal systems, business leaders often lacked a clear view into energy usage until they saw final reports. Diligent ESG by contrast delivered ongoing visibility through live dashboards, for stronger process oversight and more informed strategic decisions. By generating a central “source of truth” for ESG data for everyone involved in sustainability reporting, Diligent ESG enabled more aligned collaboration across teams and more productive conversations.
Interviewees cited improved reporting accuracy as another important benefit, enabling the organization to strengthen trust with current and potential investors. Furthermore, Diligent ESG helped the organization expand into new types of ESG data on investors’ radars, such as Scope 3 emissions. According to one interviewee, Scope 3 would not have been a possibility without Diligent ESG.
Finally, flexible, scalable features meant that Diligent ESG grew and adapted with the business, helping the sustainability team efficiently deliver custom reports per investor request.
“Moving off basic systems and into a more online-based bespoke software to address the problem was the best and optimal outcome for us.”
Group head of sustainability interviewed for the TEI report
Learn more by downloading the full Diligent ESG Forrester TEI Report.
