Technology
EU Environmental, Social, and Governance (ESG) legislation has led to new considerations for technology companies all over the world. Technology and IT companies are now required to be more transparent, accountable, and sustainable in their operations. One of the most significant challenges they face is in data collection and reporting. Whilst collection and analysis of digital data is very much the focus of many tech companies, they often lack the necessary infrastructure and ground presence to track their environmental, social and governance impact, such as carbon emissions, raw material production, energy usage, and waste production.
To meet new standards, technology companies need to gather comprehensive data and reporting across their global supply chains from ground level, a task that is both complex and resource intensive.
Tech companies often operate across multiple borders, and diverse legal and cultural landscapes of add to the complexity of reporting on ESG standards. All companies must align with strict regulations on sustainability disclosures and meet expectations around social responsibility, including labour rights and diversity, or risk facing penalties.
Supply chain management also becomes a critical concern. Many tech companies, especially those involved in hardware production, rely on suppliers from countries with lower environmental and social standards. To comply with the EU’s ESG requirements, these companies now need to evaluate their entire supply chain for compliance with these standards, a process that can be both time-consuming and costly.
