EHS Trends beyond 2024……

I was thinking on this topic as a part of my EHS jounrney and wondered how EHS trends would look by 2024 or so. Coming with practically nothing happening in 1985 or EHS things have come a long way as I indicated in my previous post. So I had put my thoughts on future trends, issues, challenges on EHS Systems, Management, processs, Technology that would be leading around that time to the AI Based platforms from both Google and Open-AI. Here is how the conversation went:- (Quotes are my thoughts and below are response).

What are the latest trends and technologies that are becoming focused in Industrial Safety, Health, and the environment that companies need to be aware of and implement to stay in the game?

It’s great to discuss the latest trends in industrial safety, health, and environment (EHS). These areas are continually evolving to ensure the well-being of workers and the sustainability of businesses. Here are some key trends and technologies that companies should be aware of and consider implementing:

• Digital Transformation: Embracing digital tools and platforms, such as IoT sensors, data analytics, and AI, to monitor and enhance safety and environmental performance. This includes real-time monitoring of equipment and environments to detect and prevent potential hazards.
• Artificial Intelligence (AI) and Machine Learning: AI can be used for predictive analytics to identify potential safety issues before they occur. Machine learning algorithms can analyze historical data to predict and prevent accidents.
• Virtual Reality (VR) and Augmented Reality (AR): VR and AR can be used for training purposes, creating immersive safety training experiences. They are also valuable for remote assistance and maintenance tasks, improving safety in high-risk environments.
• Drones: Drones are increasingly used for safety inspections, especially in hard-to-reach or hazardous areas. They can quickly assess structural integrity, monitor emissions, and enhance emergency response.
• Wearable Technology: Smart wearables like safety vests with built-in sensors can monitor workers’ vital signs and environmental conditions, alerting them and supervisors to potential risks.
• Environmental Sustainability: Companies are focusing on reducing their carbon footprint and adopting sustainable practices. This includes energy-efficient processes, waste reduction, and transitioning to renewable energy sources.
• Health and Wellness Programs: A greater emphasis on employee well-being, including mental health programs and initiatives to promote a healthy work-life balance.
• Occupational Health and Safety Management Systems (OHSMS): Implementing robust OHSMS frameworks like ISO 45001 helps companies systematically manage safety and health risks and improve overall performance.
• Supply Chain Transparency: Ensuring that suppliers and partners adhere to safety and environmental standards, promoting a holistic approach to EHS across the entire supply chain.
• Regulatory Compliance: Staying updated with evolving regulations and standards in different regions, which can significantly impact operations and reputation.
• Resilience Planning: Developing strategies to address unexpected events, such as pandemics or natural disasters, and ensuring business continuity.
• Behavior-Based Safety: Fostering a culture of safety where employees actively identify and address safety concerns, emphasizing behavioral factors.

Remember, these trends and technologies may vary by industry and region, but they all contribute to improving safety, health, and environmental sustainability. Companies that proactively adapt to these changes are more likely to stay competitive and ensure the well-being of their workforce and the planet.

Would you give an assessment from Asian standpoint on Trends in EHS?

Let’s assess these trends in industrial safety, health, and environment from an Asian standpoint, recognizing that the region’s unique challenges and opportunities shape its approach to EHS matters:

• Digital Transformation: Asian countries, particularly in East Asia and Southeast Asia, are embracing digitalization rapidly. The use of IoT sensors, AI, and data analytics is gaining traction, especially in manufacturing hubs like China and South Korea, to improve worker safety and reduce environmental impact.
• AI and Machine Learning: In countries like Japan, there’s a strong focus on using AI and machine learning for predictive maintenance and hazard identification, which aligns with their strong technology and manufacturing sectors.
• VR and AR: These technologies are being used for training and remote maintenance in the region. In countries with large construction industries, like India, VR and AR have been adopted for safety training at construction sites.
• Drones: Asian countries, including China, are leading in drone technology adoption. Drones are used extensively for environmental monitoring, safety inspections in remote areas, and disaster response.
• Wearable Technology: Some Asian countries, such as South Korea and Japan, have advanced in wearable technology for workers. These technologies are used to monitor workers’ health and safety conditions in real-time.
• Environmental Sustainability: Asian nations, particularly China and India, face significant environmental challenges due to rapid industrialization. There’s a growing focus on sustainability, with investments in renewable energy, pollution control, and green practices.
• Health and Wellness Programs: Asian countries like Singapore and Japan prioritize employee well-being. They often provide comprehensive healthcare coverage and stress work-life balance as part of their corporate culture.
• OHSMS: Organizations in Asian countries with a strong manufacturing base, such as Taiwan and South Korea, have adopted OHSMS frameworks to improve safety standards and worker well-being.
• Supply Chain Transparency: In Asian manufacturing powerhouses like China, companies are increasingly scrutinized for supply chain practices. This has led to greater transparency efforts, with a focus on ethical sourcing and EHS compliance.
• Regulatory Compliance: Compliance with evolving regulations is crucial across Asia, given the diversity of countries and regulations. Companies often need to navigate a complex regulatory landscape.
• Resilience Planning: Asian countries are prone to natural disasters, and resilience planning is vital. Japan, for example, has extensive disaster preparedness measures, including earthquake-resistant buildings and tsunami warning systems.
• Behavior-Based Safety: Cultivating a safety culture is important in Asian workplaces, emphasizing the role of individual behaviors in preventing accidents. This approach aligns with the collective mindset in many Asian societies.

From an Asian standpoint, these trends reflect a blend of technological innovation, cultural nuances, and regional challenges. The region’s commitment to EHS varies by country, but overall, there is a growing awareness of the importance of these issues, driven by both local initiatives and global pressures for sustainability and safety standards.

Eloborate a bit more on Digital transformation and Wearable technology with link to EHS trends?

Digital Transformation in EHS:

• IoT Sensors: The Internet of Things (IoT) is revolutionizing EHS by enabling real-time monitoring of equipment, environmental conditions, and worker safety. In Asia, IoT sensors are increasingly deployed in factories and construction sites to track parameters like temperature, humidity, gas levels, and machine health. This data helps identify potential hazards and prevent accidents.
• Data Analytics and AI: Digitalization generates vast amounts of data. AI and data analytics are used to process this data, providing actionable insights. For instance, AI algorithms can analyze historical accident data to predict future risks. In Asian manufacturing hubs like China, AI-driven safety analytics are becoming more prevalent.
• Predictive Maintenance: Digital technologies enable predictive maintenance in industrial settings. By analyzing data from machinery and equipment, companies can predict when maintenance is needed, reducing downtime and enhancing worker safety. This trend is particularly relevant in industries like manufacturing, where equipment failures can pose significant risks.
• Environmental Monitoring: Environmental sustainability is a key focus in Asia, where industrial growth has sometimes come at the cost of the environment. Digital technologies, including remote sensors and satellite imagery, allow for real-time monitoring of air and water quality. Governments and businesses use this data to ensure compliance with environmental regulations.
• Emergency Response: Digital transformation aids in emergency response. In disaster-prone areas like Japan, advanced warning systems and digital communication networks help mitigate the impact of natural disasters. This is crucial for ensuring the safety of both workers and the community.

Wearable Technology in EHS:

• Worker Safety: Wearable technology such as smart helmets, vests, and glasses equipped with sensors can monitor workers’ vital signs, temperature, and exposure to hazardous materials. In high-risk industries like construction and mining, these wearables can alert both the worker and supervisors to potential dangers, helping prevent accidents.
• Ergonomics and Fatigue Monitoring: Wearables can also track worker ergonomics and detect signs of fatigue. In Asian countries with labor-intensive industries, this technology can help reduce workplace injuries and improve overall health and safety.
• Training and Skill Development: Augmented reality (AR) wearables can provide on-the-job training and guidance, enhancing worker competency in EHS practices. This is especially valuable in regions where skilled labor is in demand.
• Health and Wellness: Wearables can promote employee health and well-being by encouraging physical activity, monitoring stress levels, and promoting work-life balance. Companies in Asia, where workforce health is a priority, are increasingly adopting such devices.
• Remote Assistance: Wearables equipped with cameras and AR technology enable remote experts to provide real-time assistance to on-site workers. This is particularly relevant in Asia’s diverse and sometimes remote industrial settings.

The integration of digital technologies and wearables into EHS practices enhances safety, reduces accidents, and improves overall workplace conditions. In Asia, where industrialization and manufacturing are significant economic drivers, these innovations play a crucial role in safeguarding workers and mitigating environmental risks while supporting sustainable growth.

What skill sets are required for EHS professionals to keep themselves current in these scenario? Also is Gig work/consulting support would become more relevant prevailent as domain is getting wider and wider on EHS spectrum?

EHS professionals need to continuously develop their skills to stay current in the evolving landscape of environmental, health, and safety. Here are some key skill sets that are becoming increasingly important:

• Digital Literacy: As EHS becomes more digital-centric, professionals need to be proficient in using digital tools, data analytics, and software for safety monitoring, reporting, and compliance management.
• Data Analysis and AI: A strong grasp of data analysis and AI is essential for making sense of the vast amounts of data generated by IoT sensors and other digital technologies. Being able to extract actionable insights from data is a valuable skill.
• Regulatory Knowledge: Staying up-to-date with local, national, and international EHS regulations is crucial. EHS professionals must understand how changing regulations impact their organization and ensure compliance.
• Risk Assessment: The ability to assess and mitigate risks, especially in the context of emerging technologies and digital transformations, is critical. This includes identifying new potential hazards related to technology adoption.
• Communication: Effective communication is vital for conveying safety protocols and guidelines to the workforce. It’s also crucial for collaborating with various stakeholders, including management, employees, regulatory bodies, and the public.
• Change Management: Given the rapid changes in EHS due to digital transformation, EHS professionals need to excel in change management to implement new technologies and practices smoothly within their organizations.
• Crisis Management: Skills in crisis management and emergency response are essential, especially in regions prone to natural disasters or industrial accidents.
• Environmental Sustainability: Understanding sustainability principles and practices, including carbon footprint reduction, renewable energy adoption, and waste management, is becoming increasingly important in EHS roles.
• Health and Wellness: Knowledge of occupational health and wellness programs, including mental health initiatives, is crucial for promoting employee well-being and productivity.
• Supply Chain Management: EHS professionals may need skills in supply chain transparency and ethical sourcing, as sustainability concerns extend throughout the supply chain.

Regarding gig work and consulting support, it’s highly likely that these avenues will become more prevalent in the EHS field. Here’s why:

• Specialized Expertise: The EHS domain is vast and complex, covering a wide range of topics from environmental regulations to workplace safety. Companies may seek specialized expertise for specific projects or compliance needs.
• Cost-Efficiency: Hiring full-time EHS professionals can be expensive. Many organizations prefer to bring in consultants or gig workers when they require specific skills or during short-term projects, saving on long-term personnel costs.
• Flexibility: Gig work and consulting offer flexibility, allowing companies to adapt to changing EHS requirements and technology advancements without committing to permanent hires.
• Diverse Experience: Consultants often bring a wealth of experience from working with various clients and industries, providing fresh perspectives and best practices.
• Evolving Needs: As EHS practices evolve, organizations may require guidance and support to implement new technologies and adapt to changing regulations. Consultants can help fill this need.
• Globalization: For companies with a global presence like multinational corporations, EHS regulations vary significantly from one region to another. Consultants with expertise in specific regions can be invaluable.

In summary, EHS professionals should continually upgrade their skills to adapt to the evolving landscape. Gig work and consulting in the EHS field are likely to become more prevalent due to the need for specialized knowledge and flexibility in addressing the widening spectrum of EHS challenges.

Now moving in to specifics, How to deep dive in to mental health to bring improvement? Is it more a medical intervention/counselling?

Improving mental health involves a holistic approach that encompasses both medical interventions and non-medical strategies. Here are steps to deep dive into mental health improvement:

• Self-Awareness: Start by gaining a deep understanding of your own mental health. Reflect on your emotions, thoughts, and behaviors. Keep a journal to track your moods and triggers. This self-awareness can help you identify areas where improvement is needed.
• Professional Help: If you’re facing serious mental health issues, such as depression, anxiety, or mood disorders, seeking professional help from a psychiatrist, psychologist, or counselor is essential. They can provide medical interventions like medication when necessary and offer therapy to address underlying issues.
• Therapy and Counseling: Therapy, such as cognitive-behavioral therapy (CBT), dialectical behavior therapy (DBT), or mindfulness-based therapy, can be highly effective in improving mental health. It helps you develop coping strategies, manage stress, and change negative thought patterns.
• Medication: In some cases, medication prescribed by a psychiatrist can be part of the treatment plan. It’s important to follow medical advice closely and be aware of potential side effects.
• Lifestyle Changes: Your daily habits have a significant impact on mental health. Focus on maintaining a balanced diet, regular exercise, and adequate sleep. These lifestyle changes can positively affect your mood and overall well-being.
• Stress Management: Learn stress management techniques such as deep breathing, meditation, and yoga. These practices can help you relax and reduce the impact of stress on your mental health.
• Social Support: Cultivate a strong support network of friends and family. Sharing your feelings and experiences with trusted individuals can provide emotional support and reduce feelings of isolation.
• Hobbies and Interests: Engage in activities you’re passionate about. Hobbies and interests provide a sense of purpose and satisfaction, which can boost mental well-being.
• Mindfulness and Meditation: Practicing mindfulness and meditation can improve self-awareness, reduce anxiety, and enhance emotional regulation. These techniques are effective for managing stress and improving overall mental health.
• Professional Development: Consider seeking out personal or professional development courses or workshops. Expanding your skills and knowledge can boost self-esteem and confidence.
• Volunteer or Help Others: Contributing to your community or helping others in need can provide a sense of fulfillment and purpose, positively impacting your mental health.
• Limit Substance Use: Be mindful of the impact of alcohol, drugs, or other substances on your mental health. Excessive use can exacerbate mental health issues.

Remember that improving mental health is an ongoing journey. It may involve a combination of medical interventions, counseling, lifestyle changes, and self-care practices. Everyone’s path to better mental health is unique, so it’s essential to find the strategies and interventions that work best for you.

If you’re ever unsure about how to proceed, consider consulting with a mental health professional who can provide guidance tailored to your specific needs and circumstances. Also refer to the ISO Standard ISO 45003 on Mental / Psycological health.

Also about Ergonomics, what are trends that would be top draw?

Ergonomics is a critical aspect of workplace safety and well-being, and it continues to evolve with advancements in technology and changes in work environments. Here are some of the top trends in ergonomics:

• Remote Work Ergonomics: The shift to remote work due to the COVID-19 pandemic has brought increased attention to home office ergonomics. Employers are providing guidance and support to ensure employees have ergonomic workstations at home, including proper chairs, desks, and monitor setups.
• Adjustable Furniture: Ergonomic furniture that can be easily adjusted to fit individual needs is gaining popularity. This includes height-adjustable desks, chairs with customizable lumbar support, and keyboard trays that can be moved to the preferred height and angle.
• Wearable Ergonomics: Wearable devices, such as smartwatches and fitness trackers, are being used to monitor employees’ movements and posture. They provide real-time feedback and reminders to maintain good ergonomics, especially for desk-bound workers.
• Ergonomic Software: Software applications and tools are emerging to help individuals and organizations assess and improve ergonomics. These tools can provide recommendations for workstation setup and break reminders to reduce prolonged sitting.
• Ergonomics in Manufacturing: In manufacturing and industrial settings, ergonomics is becoming increasingly important to reduce physical strain and injuries. Exoskeletons and wearable devices designed to assist with heavy lifting and repetitive tasks are being developed and adopted.
• Virtual Reality (VR) for Ergonomics Training: VR technology is used for training workers in ergonomic best practices. It provides immersive simulations of different work environments and tasks, allowing employees to practice proper ergonomics.
• Ergonomics for Aging Workforce: With an aging workforce in many countries, ergonomic considerations are adapting to the needs of older employees. This includes designing workstations and tasks that accommodate age-related physical changes.
• Ergonomics in Healthcare: In healthcare settings, ergonomic solutions are being employed to reduce injuries among healthcare workers who frequently lift and move patients. This includes patient lifting equipment and training programs.
• Ergonomics in Construction: The construction industry is incorporating ergonomic practices to reduce musculoskeletal injuries among workers. Ergonomic tools and equipment for heavy lifting and repetitive tasks are becoming more prevalent.
• Behavior-Based Ergonomics: A focus on behavior-based ergonomics is growing. This involves educating and empowering employees to take responsibility for their own ergonomic health by recognizing and addressing issues in real-time.
• Augmented Reality (AR) for Remote Ergonomic Assessments: AR technology is being used to conduct remote ergonomic assessments. Ergonomists can guide workers through self-assessments using AR tools and make recommendations for adjustments.
• Sustainability and Ergonomics: Organizations are considering sustainability in ergonomic solutions, opting for eco-friendly materials in furniture and equipment to align with broader environmental goals.

Incorporating ergonomic principles into the design of workspaces and processes is crucial for preventing injuries, enhancing productivity, and promoting employee well-being. As technology continues to advance, ergonomic solutions will adapt to new work environments and challenges, ensuring that workers can perform their tasks comfortably and safely.

In the future, how ESG/EHS (I prefer EHS) is aligning overall to business objectives/strategy with Prodcutivity, quality, inventory, delivery, cost? What business sytems that would be in place to facilitate these alignments?

The alignment of Environmental, Social, and Governance (ESG) or Environmental, Health, and Safety (EHS) initiatives with overall business objectives and strategy is becoming increasingly essential for organizations. Here’s how EHS can align with key business drivers like productivity, quality, inventory, delivery, and cost, along with the business systems that facilitate these alignments:

1. Productivity:

• Workplace Safety: EHS programs ensure a safe work environment, reducing accidents and injuries that can disrupt productivity. This includes ergonomics to improve worker comfort and efficiency.
• Training and Skill Development: EHS training programs enhance employee skills and competencies, boosting overall productivity. Training can also include cross-training to address skill gaps.
• Technology Adoption: Incorporating digital tools and automation, driven by EHS initiatives, can streamline processes and improve efficiency.

2. Quality:

• Process Efficiency: EHS practices often involve process optimization to minimize waste, errors, and defects, which, in turn, improves the quality of products and services.
• Compliance: Ensuring compliance with EHS regulations and standards can prevent costly fines and legal issues, preserving the reputation and quality of the organization’s products.
• Supply Chain Management: EHS practices can extend to suppliers, ensuring the quality and safety of materials and components used in the production process.

3. Inventory and Cost:

• Resource Efficiency: EHS efforts to reduce resource consumption, energy use, and waste generation can lead to cost savings and a leaner inventory.
• Risk Mitigation: Identifying and mitigating environmental and safety risks can prevent costly disruptions to supply chains and production processes, reducing inventory-related costs.
• Life Cycle Assessment: Assessing the environmental impact of products from design to disposal can inform cost-effective improvements in product design and material choices.

4. Delivery:

• Risk Management: EHS programs include risk assessments that identify potential disruptions in the supply chain or production process, allowing proactive measures to ensure on-time delivery.
• Sustainability Initiatives: Aligning EHS with sustainability goals can enhance the reputation of the organization, potentially attracting more customers and boosting sales.
• Technology Integration: Integrating EHS data with supply chain and delivery systems can provide real-time insights to optimize delivery routes and schedules.

Business Systems Facilitating Alignment:

• Enterprise Resource Planning (ERP) Systems: These systems can integrate EHS data with other business processes, providing a holistic view of operations. They help in managing inventory, production, and delivery in alignment with EHS goals.
• Environmental Management Software (EMS): EMS platforms enable organizations to track and manage their environmental impact, supporting sustainable practices and reporting to stakeholders.
• Supply Chain Management Systems: These systems help ensure EHS compliance throughout the supply chain and facilitate efficient sourcing, procurement, and inventory management.
• Data Analytics and Reporting Tools: These tools provide insights into EHS performance, allowing organizations to make data-driven decisions that align with overall business objectives.
• Collaboration and Communication Platforms: Effective communication and collaboration tools ensure that EHS initiatives are understood and followed across the organization, fostering alignment.
• Continuous Improvement and Lean Practices: Lean methodologies and continuous improvement practices, often linked to EHS initiatives, streamline processes and reduce waste, positively impacting productivity, quality, and cost.

The successful alignment of EHS with business objectives requires a comprehensive approach that integrates EHS practices into the fabric of the organization’s culture and operations. This alignment not only improves the bottom line but also enhances the organization’s reputation and sustainability in an increasingly ESG-focused business landscape.

In general, which sectors/industries are globally embracing EHS trends and seeing benefits the leaders? Which industries are laggards? What Laggards need to do to catch up? Or the gap so much they remain where they are without consequences and world puts up with them as they need their products/ services?

The adoption and benefits of EHS (Environmental, Health, and Safety) trends vary across industries, and some sectors have been more proactive than others. Here’s an overview of industries that have been leaders in embracing EHS trends and those that are considered laggards:

Leaders in Embracing EHS Trends:

• Technology: Tech companies have been at the forefront of EHS initiatives. They prioritize sustainability, employee well-being, and environmental responsibility. These companies often set industry standards for energy efficiency, waste reduction, and workplace safety.
• Manufacturing: Manufacturing industries, especially in regions with stringent regulations, have made significant strides in EHS practices. This includes reducing emissions, improving workplace safety, and implementing sustainable manufacturing processes.
• Pharmaceuticals and Healthcare: EHS is critical in healthcare to ensure patient safety and compliance with regulations. Pharmaceutical companies have robust EHS programs to maintain product quality and safety.
• Aerospace: Given the complex and high-risk nature of the aerospace industry, safety is paramount. Aerospace companies invest heavily in EHS to ensure the safety of both workers and the public.

Laggards in Embracing EHS Trends:

• Agriculture: The agriculture sector has been slower to adopt comprehensive EHS practices, particularly in developing regions. Issues like pesticide use, soil degradation, and worker safety remain significant challenges.
• Mining and Extractive Industries: Mining and extractive industries often face criticism for their environmental impact, including habitat destruction and water pollution. While some progress has been made, there is room for improvement in embracing EHS.
• Construction: The construction industry has a mixed record in EHS. While there are safety regulations in place, on-site accidents and injuries still occur frequently, indicating a need for better safety practices.
• Food and Beverage: The food and beverage industry, particularly in certain segments, has faced scrutiny for sustainability and waste issues. Some companies are taking steps to address these concerns, but progress varies.

What Laggards Need to Do to Catch Up:

• Compliance with Regulations: Laggards should prioritize compliance with existing EHS regulations in their regions. This is the first step toward improvement.
• Investment in EHS Programs: Allocate resources for comprehensive EHS programs that cover environmental sustainability, workplace safety, and public health.
• Education and Training: Provide training and education to employees about EHS practices. This helps create a culture of safety and environmental responsibility.
• Innovation: Look for innovative solutions and technologies that can improve EHS performance. This includes adopting cleaner technologies and sustainable practices.
• Transparency and Reporting: Be transparent about EHS performance and report progress to stakeholders. Transparency builds trust and accountability.
• Collaboration: Collaborate with industry associations, NGOs, and government agencies to access best practices and resources for EHS improvement.
• Continuous Improvement: EHS should be an ongoing effort. Continuously monitor and assess EHS performance and seek opportunities for improvement.

The gap between EHS leaders and laggards does matter, especially in an era of heightened environmental awareness and stricter regulations. Companies that lag behind may face reputational risks, legal consequences, and market disadvantages. Consumers and investors increasingly prioritize sustainability and responsible business practices, making EHS a crucial factor in remaining competitive and socially responsible. Ultimately, the world’s demand for sustainable products and services is likely to put pressure on laggards to catch up with EHS trends.

On the ESG Front, what Risks and opportunities that organisations may need to disclose as based on IFRS norms ?

Environmental, Social, and Governance (ESG) disclosures are becoming increasingly important for organizations as stakeholders, including investors and the public, seek greater transparency regarding sustainability and responsible business practices. While International Financial Reporting Standards (IFRS) primarily focus on financial reporting, there are related frameworks and guidelines that can provide insights into ESG risks and opportunities that organizations may need to disclose:

1. Environmental (E) Risks and Opportunities:

• Climate Change: Disclose risks related to climate change, including potential physical risks (e.g., extreme weather events) and transition risks (e.g., regulatory changes, market shifts towards green technologies). Opportunities may include investments in renewable energy or energy-efficient technologies.
• Resource Scarcity: Disclose risks associated with resource scarcity (e.g., water, raw materials) and efforts to mitigate these risks through sustainable sourcing or reduced resource consumption.
• Pollution and Emissions: Disclose environmental impact data, such as greenhouse gas emissions, pollution levels, and initiatives to reduce or offset emissions.

2. Social (S) Risks and Opportunities:

• Labor Practices: Disclose information on labor practices, including employee rights, diversity and inclusion initiatives, fair wages, and workplace safety. Opportunities may involve workforce development and employee well-being programs.
• Human Rights: Disclose efforts to respect and promote human rights throughout the value chain, particularly in industries with complex supply chains.
• Community Engagement: Share community engagement efforts, including philanthropy, community development projects, and partnerships with local organizations.

3. Governance (G) Risks and Opportunities:

• Corporate Governance: Disclose governance practices, including board composition, executive compensation, and measures to prevent corruption and unethical behavior.
• Risk Management: Describe the organization’s risk management processes, including identification, assessment, and mitigation of ESG-related risks.
• Data Privacy and Security: Disclose measures taken to protect customer and stakeholder data, addressing growing concerns around data privacy.

4. Sustainable Development Goals (SDGs):

• If relevant, organizations can align their ESG disclosures with the United Nations Sustainable Development Goals (SDGs). Disclose contributions toward achieving specific SDGs.

5. Reporting Frameworks:

• Organizations may adopt external reporting frameworks such as the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), or Task Force on Climate-related Financial Disclosures (TCFD) to guide their ESG disclosures.

6. Materiality Assessment:

• Organizations should perform a materiality assessment to identify which ESG issues are most relevant to their business and stakeholders. Disclose the results of this assessment to show that ESG reporting is focused on the most significant issues.

7. Forward-Looking Statements:

• Include forward-looking statements in ESG disclosures to highlight future goals and strategies related to environmental, social, and governance matters.

8. Third-Party Verification:

• Seek third-party verification or assurance for ESG data to enhance credibility and transparency.

It’s important to note that while IFRS itself primarily addresses financial reporting, there is a growing recognition of the need for integrated reporting that combines financial and non-financial information, including ESG factors. As a result, organizations are increasingly including ESG disclosures as part of their annual reports or in separate sustainability reports to meet the demands of stakeholders and investors who consider ESG performance as a key driver of long-term value.

It is assumed still IFRS norms are voluntary disclosure even though it is Third party verification but  not a mandatory Norm?

Yes, You are correct. International Financial Reporting Standards (IFRS) primarily focus on financial reporting, and compliance with IFRS is mandatory for many organizations, especially those listed on stock exchanges or operating in jurisdictions where IFRS is the accepted accounting standard.

However, when it comes to environmental, social, and governance (ESG) disclosures and non-financial information, IFRS does not mandate specific reporting requirements or standards. ESG disclosures and sustainability reporting are typically voluntary unless there are specific regulations or reporting requirements imposed by local authorities or stock exchanges.

Organizations may voluntarily choose to disclose ESG-related information in their annual reports, sustainability reports, or through other channels to meet the growing demand for transparency and accountability from stakeholders, including investors, customers, and the public. Many organizations recognize that ESG disclosures can enhance their reputation, attract socially responsible investors, and align with sustainability goals.

While third-party verification or assurance for ESG data can enhance credibility, it is typically not mandated by IFRS or other global financial reporting standards. Instead, organizations may engage third-party auditors or verification providers voluntarily to independently assess the accuracy and completeness of their ESG disclosures.

It’s important for organizations to consider the expectations of their stakeholders and relevant regulations in their industry or region when determining the extent and nature of their ESG disclosures. The landscape of ESG reporting is evolving, and as sustainability and responsible business practices gain prominence, we may see more standardized and mandatory reporting requirements in the future.

Karthik

11th Sep 2023…. (What a date!! 9/11 has its own significance for me, that is a different topic!).