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ESG in Retail

ESG programs for retail

In today’s world, environmental, social, and governance (ESG) is a core pillar of value creation for organizations of all sizes. Due to an evolving set of expectations from stakeholders and pending regulatory requirements, ESG is no longer a discussion—it’s a necessity.

In the retail sector, consumers’ preferences have changed, and environmental and social values are being infused into buying decisions.

ESG issues specific to retail

Every industry has different driving forces behind the development of ESG programs. The following issues are material to the retail sector:

Global supply chains involve hundreds of stakeholders and a myriad of activities that are often opaque and complex from an ESG perspective. As a result, the retail industry will need to monitor its supply chain for ESG issues.

Upcoming regulation on public companies to disclose and report on their Scope 1, 2, and 3 greenhouse gas (GHG) emissions will put pressure on the entire supply chain to map out their carbon footprint.

The retail sector has a large number of environmental risks that need to be managed. The sector needs to gain resilience to regulatory change by planning for climate risks, carbon pricing, and anti-pollution policies like bans on single-use plastics.

The interconnectedness of today’s world means that a corporation’s cyber policy, compliance, and risk metrics can have far-reaching impacts that can cascade throughout society. Customers want to know that their information is protected, and that data won’t be shared or sold to other organizations or retailers.

The retail sector needs to manage human rights and child labour across its entire value chain.

Benefits of investing in ESG programs for retail:

Early integration of an ESG program strategically positions your organization for long-term success
Customer acquisition and retention
Access to capital
Supply chain optimization considering ESG imperatives.
Operational efficiency and innovation
Partnership opportunities and community impact

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