Emerging risks continue to emerge around the world, gradually changing our lives. Climate change causes the earth's temperature to continue to rise, human economic activities cause climate changes, and the impact of the epidemic causes a reshuffle of global supply chain strategies. What changes will occur in the future is unknown.
▍In 2015, the United Nations set 17 sustainable development goals and 169 specific targets, covering three major aspects: environmental protection (Environmental), social progress (Social) and economic growth (Governance), as guidelines for the development of countries around the world before 2030. The abbreviation is ESG, which is a United Nations initiative.
The Taiwan Economic Management Commission has stipulated that companies should continuously strengthen information transparency and disclosure quality, respond to ESG-related risk issues of concern to stakeholders, and promote sustainable operations. The "Operational Guidelines for the Preparation and Submission of Sustainability Reports by Listed and OTC Companies" announced in December 2011, the standards for sustainability reports are called the "GRI Standard" released in 2019 and the "Universal Standards 2021" released in 2021. The targets are food industry, chemical industry, and financial insurance companies, those with catering income accounting for more than 50% of revenue, and those with a capital of more than NT$2 billion (2021).
▍Taiwan’s Environmental Protection Agency has also responded to the international trend of net-zero carbon emissions. In July 2015, the “Greenhouse Gas Reduction and Management Act” clearly set a goal of reducing carbon emissions by 50% from 2005 levels by 2050. The "Guidelines for Greenhouse Gas Emission Source Inventory" will be revised by the end of March 2022 to provide more concise regulations for manufacturing industries with smaller emissions, companies that need to conduct carbon inventories due to supply chain requirements, or other small and medium-sized enterprises and service industries that voluntarily conduct inventories.
Simply put, large companies need ESG reports to comply with corporate sustainability requirements, while small and medium-sized enterprises need to conduct carbon emissions audits to comply with the Environmental Protection Agency's requirements. If you want to leap from a small or medium-sized enterprise to a large enterprise, you must start with overall strategic planning and sustainable development reports.
Small and medium-sized enterprises account for as much as 90% of Taiwan's total economy. Therefore, how to assist small and medium-sized enterprises in disclosing information in the future is an important challenge that the government and enterprises must face together.
What to do?
I believe that we should clarify our own corporate performance indicators as soon as possible through the inspection of third-party certification agencies, such as ISO 9001, ISO14001, and ISO 14064-1 standards, and establish a company document management system.
The next step is to start the next phase of the sustainability report.
As for how much benefit ESG can bring to enterprises? In the current social environment and the development of the international situation, there are too many news reports about ESG doing well and EPS growing in a linked manner, so I will not elaborate on this.