In an increasingly data-driven world, businesses are undergoing a transformation in how they operate, engage with clients, and deliver value. Data is no longer just a tool for company reporting; it is a strategic asset that, when leveraged effectively, can drive proactive decision-making, operational efficiency, and differentiation in a competitive market.
This is especially true when it comes to the management of GHG emissions data. However, simply having the data is not enough. The ability to understand, interpret, and act on this information is what truly sets organisations apart and what will help shape decarbonisation efforts in the pursuit of an ambition to be net-zero by 2050 or sooner. The key lies in moving beyond static, historical data analysis to real-time, dynamic decision-making that aligns with business goals.
Challenges in leveraging data strategically for ESG
Despite the opportunities provided by having the data, there are challenges in using the data strategically for ESG purposes:
- Data quality and integrity: ensuring the accuracy, consistency, and reliability of data is crucial. For example, moving from spend-based emissions calculations to supplier-specific metrics will provide a more precise understanding of a firm's material suppliers and their impact.
- For example, if a company that is starting its scope 3 decarbonisation journey buys laptops, it may only have access to spend data. Suppliers would be prioritised based on spend only and this will provide a basic level of hot-spot analysis. Implementing a supplier engagement strategy allows the company to acquire supplier- and product-specific emissions data, enabling it to make comparisons at emissions level. Purchasing decisions can then be based on a combination of product emissions and the company’s decarbonisation strategy.
- In BDO’s case, some of our firms have a large percentage of their emissions from activity outside their geographic borders, highlighting the importance of location and supplier-specific data.
- Data governance: accessibility, frequency and compliance often hinder organisations from effectively using their data for timeous decisions, actionable insights and competitive differentiation. Without these elements, decision-making lags real-world changes, leading to missed opportunities for decarbonisation action, for example.
- Interpreting data for actionable insights: raw data alone does not translate into strategic decisions. Firms need skilled professionals - carbon accountants, ESG experts, and subject matter specialists - who can extract meaningful insights and build actionable plans. If one does not have these skills in-house, engaging them via an external consultancy is an alternative.
- Bridging from data to commercial impact: even the best data strategy requires buy-in from leadership to drive a data-centric culture within an organisation. Professionals with the gravitas and capability to translate data-driven insights into commercial outcomes are essential for driving change at the executive level. This is especially true when driving the commercial discussion around sustainability.
Building a strong data-driven culture
To fully leverage data, organisations must invest in the right skills and capabilities or hire professionals who can translate complex ESG data into actionable business insights. It’s also important to integrate the relevant functions, such as procurement, early in the decarbonisation process so that emissions management and supplier engagement work in collaboration with one another. While emissions management platforms provide valuable data, they serve merely as a starting point. We must still analyse the data, extract meaningful insights, and develop clear action plans that integrate sustainability, risk management, and financial impact.
From data collection to strategic decision-making
At BDO, we’ve learnt that building a data-driven approach towards measuring progress in sustainability takes time. In our first year we focused on setup, adoption, learning how to use the technology platform and ensuring data was consistently recorded. By the second year, we could shift toward strategic use, leveraging data for target setting, tracking, and supplier relationship management. Our third year of data collection saw a noticeable improvement in data quality.
Data is a powerful tool for progressing a sustainability programme, but it is only as valuable as the strategic actions it informs. We’ve found that investing in quality data, insightful interpretation, and strategic application – either for our own operations or when advising clients - not only enhances our own processes but also helps our clients navigate complexity with clarity and confidence.
In summary:
- Data is a strategic asset: Leveraging high-quality, timely data transforms sustainability from a reporting exercise into a driver of proactive decision-making, operational efficiency, and competitive differentiation.
- Quality and interpretation matter: The value of data lies not just in its collection, but in its accuracy, integrity, and the ability to interpret it for actionable insights. Investing in skilled professionals or external expertise is essential.
- Collaboration is critical: Integrating ESG, procurement, and other relevant functions early in the process ensures that sustainability efforts are aligned, effective, and embedded across the organisation.
- Technology is a tool, not the solution: Technology platforms provide a foundation for emissions management, but real impact comes from analysing data, extracting insights, and developing clear action plans that connect sustainability with business goals.
- Continuous improvement drives success: Building a data-driven sustainability culture is a journey. Start with consistent data collection, then evolve toward strategic use - setting targets, tracking progress, and using insights to inform internal operations.
