Investors and stakeholders are increasingly demanding that companies address Environmental, Social, and Governance (ESG) issues and demonstrate how their Boards oversee strategic and operational decisions related to ESG and renewable energy so that they can put these corporate citizenship practices into action. Therefore, energy companies, both large and small, should be formalizing plans and initiatives in the face of growing ESG investment strategies, financial disclosures and increasing regulatory and public policy requirements. 

ESG & Renewable Energy: 3 Ways Companies Can Get Ahead Of The Game

With ESG here, and on the minds of boardroom executives in every industry, especially those in energy company boardrooms, what should they be doing? With a focus on the “E” in ESG, here's what they are, and should, be doing:

1. Develop, publish and execute an ESG strategy that covers sustainability programs geared for the three Rs (“3R”)—Renewal, Recovery and Removal

   •   Renewal means to outline a transition towards sourcing more renewable energy
   •   Recovery means to address improvements in energy efficiency
   •   Removal means to control and reduce greenhouse gas emissions (GHGs)

2. Setup organizational business line(s) for sustainability and renewables or operational and non-operational

   •   Sustainability lines should manage non-operational 3R programs
   •   Renewable lines should own the operational value chain and implement 3R plan

3. Govern sustainability and renewable programs for reporting and audit

   •   Assess, measure, trak, report and repeat
   •   Prepare for board reviews, internal audits and eventual external ESG audit

ESG & Renewable Energy: 3 Ways how to optimize your Value chain

Below are three corporate initiative areas companies should focus on when implementing ESG strategies: 

1. Value Chain Integration

   •  Energy companies need to troubleshoot problem areas in their existing end-to-end processes
   •  Look for cross-functional, cross-business line improvements with an eye towards renewable   energy expansion
   •   Focus on the ever-challenging accounting and operations integration (i.e., book-to-physical   functions)

2. Value Chain Simplification

   •    Work backwards in the value chain process to simplify, which is easier said than done, in an era of bigger and better data
   •    Place an emphasis on contracts and contract pricing. The goal here is to reduce office support and office support issues, which almost always "roll downhill"

3. Value Chain Visibility

   •    Simplified processes and streamlined organizations require improved communication and value chain visibility, provided by technology
   •    Digital transformation, the popular buzzword trend, can facilitate further simplification of the process and IT landscape
   •    Cloud platforms like Salesforce, when done correctly, can provide a common platform for simplified energy company processes