The application of environmental, social, and governance factors and risk management strategy in facilities management is relatively new. The idea first arose in the early 2000s when investors began to think about how nonfinancial factors could influence return on investment, and specifically, facilities have faced increasing pressure in recent years to implement sustainable initiatives. This is quickly given rise to the demand for ESG reports on corporate responsibility. Facilities Managers that wish to keep their organizations ahead of the game need to understand how ESG in facilities management illuminates the path to success in smart building management.
What About Organizations That Do Not Consider ESG in Facilities Management?
Considering ESG in facilities management might seem like an added burden and expense. It requires Facilities Managers to carefully consider how their actions and activities affect the environment, consumers, and oversight agencies. Oversight depends on the type of agency, but the Department of Energy stands out as perhaps the most significant oversight agency concerning facilities management. Of course, the Environmental Protection Agency also plays a role in the oversight of buildings in the US. Now, the current administration has taken great strides to reduce the impact of regulations on the economy, but Facilities Managers must not grow accustomed to a perception that regulations are on their way out. They are not, and history reveals that chances will lead to increased regulations in the near future. Unfortunately, failure to consider ESG will inevitably lead to higher operating expenses, if not the assessment of fines and penalties by the government, as reported by FacilitiesNet.
ESG Offers Key Advantages
There was a time when considering ESG principles in facilities management was listed as an "extra benefit." Today, investors and consumers actively look for sustainable businesses, and this principle means companies that do not implement sustainable practices will see a reduction in both investing and business in general. According to Environmental Leader, applying ESG data offers key advantages for businesses. It allows Facilities Managers to communicate performance to stakeholders through the use of advanced dashboarding and record-keeping tools. Data about the environment and how existing activities influence it continuously improves operations, and it all aligns an organization with an overarching concept of social and environmental responsibility.
Furthermore, the use of ESG in managing a business offers additional benefits that derive from the underlying technologies required to consider ESG in the first place. Big data analytics, wireless sensors, and other advancements are necessary to manage and collect data. The same resources can be applied to reduce the operating expenses for business, providing a push to an organization's profitability and energy efficiency.
Achieve Better ESG Management With the Right Systems
Finding the best path to applying ESG management in your facilities is not always easy. The Internet is littered with thousands of possible software vendors, and each one claims their solution is the best. However, not all ESG platforms consider the true scope of variety and data that may exist within your organization. The only way to truly understand how your organization affects the environment, society, and government oversight lies in detailed, careful data analysis. If your organization does not know how much it is currently spending and what is needed to achieve success in ESG in facilities management, you are likely missing out. Apply ESG in facilities management by choosing the right smart building solutions provider. Contact ENTOUCH online to kickstart your new risk management and sustainability strategy now.