03 May 2022 The importance of innovation in ESG
Authored by RSM US LLP, May 03, 2022
Over the past five years, environmental, social and governance practices have grown exponentially across industries as stakeholders have demanded that companies take action.
A special report on ESG from RSM last year showed a dramatic rise in middle market business executives who said they were familiar with the subject, increasing from 39% in the fourth quarter of 2019 to 69% in the third quarter of 2021.
ESG has now become an expectation among middle market firms, leading to the question, “How can companies and organizations differentiate themselves further through ESG?” The answer to this lies in an additional letter—I, representing innovation.
Innovation drives ESG progress and enables organizations to achieve their ESG goals. Without innovation, ESG would not have reached its current level of prominence within both public and private domains.
Engineers are uniquely positioned to drive this innovation and help their companies, clients and communities make significant strides in adopting ESG practices from a technical, operational and executive perspective.
The benefits of ESG
Aligning social and environmental goals and improving financial performance can be achieved only through the meaningful and intentional integration of ESG into the company’s operations.
Through innovation, consulting engineers can promote this integration in several ways:
- Sustainable design: Many innovative ESG concepts—including societal and environmental impact studies, circular economy models and product differentiation—can be leveraged as part of the integrated design process for engineering projects. Asking the right questions at the outset of a project allows engineers to make innovative and well-informed decisions that will affect the outcome of a project.
- Emerging technology: Innovative and emerging technology is critical to incorporating ESG into the design, implementation and management of projects. Much like building information, modeling changed the landscape for how infrastructure projects are managed. New and emerging technologies like environmental management systems, void analysis tools and impact reporting software are used by engineering firms to incorporate and communicate the value of sustainability innovation in their projects.
- Fostering next-generation leaders: Innovation and ESG can successfully address global environmental and social issues only if it is sustainable across multiple generations of professionals. Fostering a culture of innovation and creativity within a consulting engineering firm is just as important to the long-term success of the engineering industry as providing innovative solutions. The next generation of innovative engineers will require a canvas to learn, grow and explore. Engineers in training can flourish in an environment that encourages innovative solutions and creative thinking.
By focusing on innovation, engineering firms will better meet ESG goals for their clients and communities.
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This article was written by RSM US LLP and originally appeared on May 03, 2022.
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