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OPINION: Real-time reporting, sustainability

OPINION: Real-time reporting, sustainability

May 14, 2014

Over the past 20 years, there has been considerable and rapid evolution in the discipline of sustainability management.  From a barely-noticeable point on management’s radar prior to The Global Reporting Initiative releasing the initial version of its sustainability reporting guidelines in 1999, sustainability management has become one of the key focuses in the boardroom.

With the growing emphasis on sustainability management, companies are going to demand better systems that enable a consolidated view of the health of a business in real-time. Current systems simply aren’t cutting it.

“Over the past two decades, systems have been developed to enable reporting in a more coherent and standardised way, in response to the growing awareness of the impact that business has on the environment, and as companies have begun to realise that running a business sustainably is simply good for business because it leads to longer term profitability.

“In tandem, there have also  been other, practical, changes to reporting standards, such as the move with G4 reporting to a focus on materiality. This has shifted priorities to what is most important.  –“Looking ahead, the trend towards real-time reporting on sustainability will gain considerable traction as companies become increasingly focused on being truly sustainable enterprises, and as sustainability systems and reporting standards continue to evolve,” says Dennis Marketos, director  at Metrix Software Solutions Pty Ltd.

Evolution, like the tides, cannot be held back. It is the driving force behind not only the way life develops, but the way business, technology and even social practices change and adapt. In business, as in nature, non-viable creatures such as Enron, with their false promise of easy money, die out, outlived by businesses with truly sustainable operating principles.

Similarly, systems that can’t keep pace with the evolution of companies’ sustainability objectives will too die out.

A parallel can be drawn with the evolution of ERP software and systems. The bureaus that ran systems for businesses in the 70s, provided batch-based reporting, with final numbers only presented several weeks after the end of the month. Business also had multiple systems, often from different suppliers, for managing, their general ledger, cashbook, stock and purchasing.

This was obviously inefficient and did not enable management to make properly-informed decisions. In response to this dilemma, during the 1980s and 1990s, software companies providing integrated solutions that offered real-time reporting began to evolve. These included the  likes of SAP for large businesses, and Accpac for smaller ones.

Likewise, it is natural for sustainability reporting to follow this path. Currently, much of companies’ annual reporting is done once a year and in a mad flurry towards the end of the reporting period. The data has to be consolidated from multiple different sources and is aggregated, analysed and graphed manually. This is inefficient and has to change.

In the coming years, business that take sustainability seriously will move to implement software solutions that enable the centralisation of sustainability-related information. In real-time, and in one place, these systems will offer  strong reports and dashboards which empower managers to see trends, spot exceptions, and to bring improvements to the way the business is run. Rather than waiting until after the year end to see how the business performed, management will be able to see in real-time the health of the business in areas beyond just the financial.

Evolution favours those entities with a competitive advantage.  Companies that have better systems to manage sustainability and governance will be better positioned to prosper into the future.

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