ESG

Not every business needs external ESG support. A consultant can be particularly useful where you need to develop an ESG or responsible business strategy, respond to customer or investor requirements, prepare for sustainability reporting, measure emissions or establish a credible net-zero plan. External support can also provide specialist expertise or additional capacity that may not exist internally. The objective should not be to create ESG activity for its own sake, but to identify the environmental, social and governance issues that genuinely matter to the business and its stakeholders and develop a practical approach to managing them.

There is no standard fee. Costs depend on the scope and complexity of the work, size of the organisation, availability of data and level of specialist input required. A focused assessment or carbon-footprint exercise will generally require less work than developing a comprehensive ESG strategy, reporting framework or multi-year net-zero programme. When comparing proposals, businesses should consider what is included, the outputs they will receive and the level of implementation support provided. A clearly defined initial assessment can often help establish priorities before committing to a larger programme.

A good ESG consultant should help you understand your current position, identify the issues that matter most and translate them into practical priorities, measurable objectives and an achievable action plan. Depending on your requirements, this might include ESG assessment, stakeholder and materiality analysis, carbon measurement, sustainability reporting, net-zero planning, governance, policies and performance indicators. The consultant should also help build internal capability rather than creating unnecessary dependence on external support. The outcome should be an approach that is proportionate to your business and connected to its wider commercial strategy.

Many businesses use a combination of internal ownership and external expertise. ESG is most effective when it is embedded within the business rather than owned entirely by an external adviser, so responsibility for implementation should normally remain internally. A consultant can provide specialist knowledge, independent challenge, additional capacity and support in areas such as carbon accounting, reporting requirements or strategy development. The right balance depends on your organisation's size, internal expertise, regulatory exposure and ambitions. External support can be particularly valuable in establishing the framework before responsibility progressively moves to internal teams.

That depends on your size, corporate structure, listing status and the sustainability reporting requirements that apply to your organisation. However, statutory reporting is only part of the picture. Businesses are increasingly being asked for sustainability information by customers, investors, lenders and larger organisations within their supply chains. A company that is not directly subject to mandatory reporting may therefore still face significant commercial pressure to provide credible environmental and sustainability data. It is worth assessing both your formal reporting obligations and the information your key stakeholders are likely to require.

A credible net-zero strategy starts with understanding your current emissions rather than simply setting a distant target. The business should establish an appropriate greenhouse-gas emissions baseline, understand the main sources of emissions and identify realistic opportunities to reduce them. From there, it can set measurable targets, assign responsibilities and develop a phased reduction plan covering areas such as energy, buildings, transport, procurement and supply chains. Progress should be measured and reported regularly. The emphasis should be on genuine emissions reductions, with any use of offsets considered carefully rather than used as a substitute for reducing emissions within the business and value chain.

Scope 3 covers indirect emissions across your wider value chain, potentially including purchased goods and services, capital goods, transport, business travel, employee commuting, waste, use of sold products and other upstream and downstream activities. For many businesses, Scope 3 represents the largest part of their carbon footprint but can also be the most difficult to measure because much of the required information sits with suppliers and customers. A practical approach is to identify the most material categories, establish an initial baseline using the best available data, improve data quality over time and work with key suppliers and partners on targeted reduction initiatives.

Larger organisations are increasingly asking suppliers for information about their carbon emissions, energy use, net-zero targets, environmental policies, responsible sourcing, waste, supply-chain practices and wider ESG performance. Requests may include Scope 1 and 2 emissions and, increasingly, information that helps the customer calculate and reduce its own Scope 3 footprint. Suppliers may also encounter sustainability questionnaires, procurement scorecards, tender requirements and requests for evidence supporting environmental claims. Businesses that can provide reliable information and demonstrate measurable progress may therefore strengthen their position in procurement processes and customer relationships, even where they are not themselves subject to mandatory sustainability reporting.