ESG (Environment, Social, Governance) is undoubtedly one of the hottest business topics in the manufacturing sector. With increased scrutiny from regulators, investors and the public, ESG has seen a meteoric rise in recent years. Meeting ESG targets is now business-critical for many organisations, which is where software development company Intelex Technologies comes in. 

Intelex is a global leader in environmental, health, safety and quality management (EHSQ) software. The company has developed powerful digital solutions to help organisations in industries around the world deliver on their ESG commitments and sustain their compliance with international EHSQ standards and regulatory requirements. 

“At Intelex, we’re committed to driving forward our own ESG efforts and improving our sustainability initiatives, playing our part in helping meet our net-zero goals to create a more sustainable future,” says Ben Henderson, Head of Product Solution Consulting at EMEA Intelex Technologies. “We know first-hand the importance of being able to evidence actual delivery on these promises in real and meaningful terms to all our stakeholders – our leaders, our people, our clients, our supply chain partners – demonstrating compliance, accountability and transparency.”

Intelex’s web-based platform and applications enable almost 1,400 clients in 195 countries to manage, measure and report on their EHSQ and ESG programmes effectively and efficiently, enhancing business performance, sharpening competitive edge and driving commercial success. 

“We believe that the greatest impact we’re having on ESG and sustainability is by helping our clients improve their efforts and initiatives through effective reporting,” explains Henderson. “Our ESG management software helps organisations gain valuable visibility about their performance against a range of different metrics – from emissions to worker safety. This enhanced factual perspective in turn leads to greater insight as to which aspects of their current ESG strategy are working and which might require further attention.”

ESG efforts and sustainability initiatives at Intelex

According to Henderson, there is a significant difference in ESG maturity, with Europe being around two years ahead of North America. But even with this notable discrepancy, there is still a long way to go before there is anywhere near the level of maturity in other areas, such as health and safety. 

“The regulatory framework is a factor here – with organisations not facing equivalent ESG compliance requirements compared to those in health and safety,” explains Henderson. “A key challenge faced by those working in the industrial and consumer manufacturing sectors is ESG performance measurement. In essence, many companies are struggling with data and are not easily able to put together a complete picture of their ESG efforts.”

Henderson understands why organisations are struggling to collect the data they need to deliver key reports for regulatory purposes. “Our research findings show that 48% of companies in the consumer and industrial manufacturing sectors are using separate solutions, or basic software such as Excel and even – in extreme cases – no digital methods at all.”

Using a dedicated software solution for ESG management can act as a catalyst for organisations to get their ESG practices on track and drive-up business performance. “Giving sustainability managers and other ESG professionals the necessary data to inform their decision-making creates a virtuous circle: helping secure buy-in from colleagues for their ESG initiatives – internal support that is vital for determining successful uptake, practice and outcomes.”

Intelex surveyed more than 700 EHS and ESG professionals across Europe and a wide range of sectors. It's clear that the greatest challenge faced by organisations is getting their employees on board with ESG initiatives. 

“According to our research findings, over a third of businesses report that the key challenge they face is internal support of and adherence to their EHSQ and ESG efforts. This issue is one that is fundamental to corporate culture. How do you drive engagement to get people at every level to play their part and own the challenge of improving how the business operates?”

Ultimately, Henderson believes that bringing people on board with EHSQ and ESG initiatives means removing barriers to engagement. 

“Our experience shows that the key to this is having the right tools and the right data at your fingertips, alongside the correct training and engagement with the workforce to ensure everyone is on board from the outset,” he says. “Often, we see an organisation’s EHSQ and ESG data located in a mismatch of software, and we have found that most organisations are using solutions that aren’t fit for purpose, meaning they are unable to put together a complete picture of ESG activity.”

Post-COVID-19 business recovery

The COVID-19 pandemic was a reality check for businesses who, up until that point, had been reluctant to embrace digital transformation and suddenly found themselves unprepared for the increasingly digitised world that lay ahead.

“There has now been a clear shift in the way in which people work, with employees expecting to not have to come to the office five days a week and, as such, companies need the digital architecture to be able to deal with this,” says Henderson. “Our research found that between 15-33% of companies in the consumer and industrial manufacturing sectors across Europe are still taking paper copies to manage every part of their EHSQ and ESG initiatives, from sustainability and air emissions to incidents and risk management. Only 31% of respondents use in-house technology that’s specifically designed for such specialist monitoring and reporting purposes.”

Businesses now are operating in a world where there is no longer expectation for employees to be in the same location – especially management. It’s therefore becoming more important than ever that EHSQ and ESG professionals can access automated data, with reliable, real-time reports enabling them to spot trends and potential issues. 

“Using non-specific EHSQ and ESG technology, or – in the worst-case scenarios – depending on paper-based approaches can mean a lag-time in reporting and that information is immediately out of date, potentially even inaccurate,” says Henderson. “Cloud-based software, such as Intelex’s platform and applications, ensures both accuracy and ease of access. These solutions mean that any incident on the ground is reported in real time, giving those who need it instant visibility and meaning they can react quicker to stop such incidents happening again.”

During his time at Intelex, Henderson’s biggest lesson in ESG has been how important the role that data collection and analysis plays in supporting the ESG efforts of organisations who have shifted their focus to environmental performance.

“Our research findings show that one of the other great challenges many organisations face is how well they can measure ESG performance improvement metrics,” Henderson explains. “For many of the people I speak with, the challenge here continues to be disconnected data – we found that just 13% of respondents to our survey have a fully integrated and connected ESG system. By this, we mean one that can take feeds from IoT devices that use APIs to connect to other systems and include big data analytics to help them make sense of events. The good news is that many companies out there have managed to link their ESG-specific applications together. This should offer a solid foundation for further progress.”

Yet Henderson finds it concerning that the majority of organisations are still using separate pieces of software such as Excel and SharePoint to manage their ESG programmes. 

“The use of disconnected, non-specialist software is a sub-optimal solution and offers an important insight into why, as mentioned, the number one challenge respondents face is how well they can measure ESG performance improvement metrics.” 

At Intelex, the next 12 months will focus on identifying gaps in the tools available to track the impact of a businesses sustainability efforts and advancing tracks for regulatory compliance. “As organisations grow their maturity in ESG, we plan to grow right along with them,” concludes Henderson.