In a world where sustainability has become a pressing need, sustainability reporting and due diligence rise as key pillars to drive positive change. These two business practices are not only a moral responsibility, but also a strategic opportunity to stand out in an increasingly aware and demanding market.
Sustainability reporting is the essential tool that enables organisations to measure, assess and communicate their performance in key areas such as the environment, human rights and corporate governance. As the DG for sustainable business, José Vicente Soler Gironés, said last week, companies can show their commitment to sustainability and build trust with their stakeholders through transparent and clear reporting. It is not just about complying with norms and standards, but about initiating real change towards more sustainable practises.
However, sustainability reporting is only the first step on the road to a more responsible future. This is where due diligence comes in, a practise that aims to identify and address risks related to human rights, youth labour, corruption and other issues that may arise in the supply chain. Due diligence not only guarantees transparency, but also helps to build more ethical business relationships and protect a company’s reputation.
The combination of sustainability reporting and due diligence gives companies a significant competitive advantage in the real market. By adopting these practises, companies can distinguish themselves as sustainability leaders, attract consumer attention and responsible investors. Furthermore, companies that understand and address the risks in their supply chain can avoid scandals and crises that could damage their reputation and financial performance.
Sustainability reporting and due diligence also have an impact beyond the boundaries of a company. By openly communicating their sustainability efforts and results, organisations inspire others to follow their example and contribute to the common good. It also promotes positive change in the industry as a whole by demanding transparency and ethics throughout the supply chain.
As digital trade publication BDO explains, this is a set of requirements that will come into effect from 5 January 2023 with the new European directive on corporate sustainability reporting, known as CSRD, which requires companies with more than 250 employees to produce these reports. It is important to recognise that implementing sustainability reporting and due diligence can present challenges and require significant resources. However, the long-term rewards are valuable both for the company and for society at large. It is not just about surviving in an ever-changing world, but also about thriving and leaving a positive legacy for future generations and adapting to the legal framework that the EU has defined for more than a decade, as Johanna Gallo explains in this article for Haz Magazine.
In summary, sustainability reporting and due diligence are powerful tools to drive change towards more sustainable and ethical business practises. These practises not only help businesses compete in a competitive marketplace, but also help create a better future for all. It is time to make the most of this opportunity and take appropriate action to create a more sustainable and responsible world.
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