Sustainability is becoming a business necessity, and more businesses are embracing environmental, social, and governance initiatives.
ESG-oriented investing has seen a meteoric rise. Global sustainable investment has now surpassed $30 trillion, up 68% from 2014, according to McKinsey & Company in 2019.
As corporate responsibility becomes more important to communities, customers, employees, and investors, businesses are paying more attention to environmental, social, and governance standards. In 2020, the World Economic Forum published a framework for consistent standards to support integrated annual reporting. Many leading organizations have since adopted it.
ESG standards must be implemented and aligned with UN Sustainable Development Goals (SDG) at the highest level:
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ESG guidelines may sound broad, but they are a framework that does a lot of good in many ways. It allows for increased trust among customers, reduces operating expenses through more efficient energy consumption, waste disposal, and other inefficiencies, and increases employee productivity by establishing a strong external value proposition.
According to KPMG's research, 80 percent of businesses worldwide are now reporting on sustainability. Environmental sustainability reporting has made substantial advances in recent years, with 63% of organizations putting their environmental emissions above the rest.
Climate technologies are becoming more and more popular as these initiatives spread. McKinsey & Company estimates that 35 to 45 percent of the technologies required to solve the net-zero equation are currently in development.
Although life on land and in water remains very poor, with less than 20% of organizations recognizing biodiversity-based ecosystem sustainability as their top priorities, these areas are rapidly emerging as regulatory requirements in many regions.
There is no such thing as excessive data.
Data is critical to every major undertaking. These technologies, as well as the programs that enable them to operate, are dependent on data. Organizations can make better business decisions, assess detailed findings, and produce more precise reports because to accurate, accessible, and actionable data.
Satellites are one new data source. Far beyond weather forecasting and online maps, modern satellites now provide enormous amounts of data that help to assess what happens on the ground. In fact, with predictive modeling, it is even possible to anticipate and prepare for likely future scenarios with great precision.
What information may satellites provide?
Currently, more than 1,000 satellites enter orbit every year, displaying a wide range of capabilities. Various technologies, such as multispectral bands and synthetic aperture radar (SAR), capture high-resolution photographs, some of which the human eye cannot see unaided. With expertly trained artificial intelligence (AI), digital images yield data about chlorophyll content and moisture levels in vegetation, the extent of biodiversity, and more.
AI-powered satellites can inspect more than 10,000 kilometers per day, freeing up budget and workforce to concentrate on the higher-value, exceptional tasks.
ESG: What you cant measure can't improve.
One of the uses of the information is to monitor progress in environmental, social, and governance initiatives. The United Nations' measurement, reporting, and verification (MRV) system has wide support by governments and industries. In essence, MRV is required because corporate and government commitments to sustainability metrics require baseline measurements to compare against ongoing progress measurements.
ESG and sustainability measures are typically broken up into four areas.
One area is the nature-based assessment of land and water. It encompasses carbon stocks and annual fluctuations, biodiversity, water extraction, return water quality, contribution to air pollution impacts, and changes in land use.
The second common area is the monitoring of GHG emissions to quantity GHG levels, which are reported in terms of CO2 equivalents from operational activities and progress toward reducing GHG targets.
The third is carbon offset measurements, which are often used as part of a strategy to offset operational emissions that are difficult to remove.
Fourth is the preservation of life, including species and habitats, as a result of biodiversity measurements. Unlike carbon and GHG measurements, there is no widely accepted standard unit to measure biodiversity, although many measures exist.
Satellite data offers four strategies to increase business value for environmental, social, and governance (ESG).
With all of this in mind, here are a few strategies to utilize satellite data to enhance business value from ESG initiatives. They are particularly useful for industries that have assets distributed over large geographical areas, including electric utilities, gas utilities, energy, water and wastewater, mining, and transportation.
Satellite imagery may assist utilities in determining pipeline routes, detecting leaks, and preventing environmental catastrophes. Other key industries with widely distributed assets, such as mining and transportation, can also benefit from regular inspections of their assets' health and hazards.
Land mapping helps to monitor the environmental impacts of various assets, but it has traditionally required hiring professional environmentalists to inspect the land on foot or from helicopters over multiple days. The cost of these methods limits their scope and frequency.
Satellite land surveys can be completed within ten to twenty times less time than traditional land surveys. Water and wastewater organizations are just a few of the beneficiaries of these advances.
Satellite data allows businesses to make informed, predictive models to minimize their environmental impact by establishing a baseline and monitoring progress against biodiversity net-gain objectives, as is the case for all land development in the United Kingdom.
Satellite data allows oil companies to anticipate how much environmental damage will result from laying a new offshore pipeline and formulate their mitigation strategies. Similarly, satellite data can assist electric power utilities in predicting vegetation growth so they can manage rights-of-way, detect invasive vegetation, and mitigate potential outages and wildfires.
Satellite data provides a means to monitor, improve, and report environmental data to consumers, investors, and regulatory authorities.
Satellite data helps to monitor carbon, methane, and other greenhouse gas emissions in order to ensure that regulatory requirements and public commitments are met. Transportation companies and power utilities may use the data to plan and manage routes through wetlands and other sensitive areas that host protected animals.
The bottom line for ESG is
Climate technologies, like satellites, increase the accuracy of information used by core industries, improving the effectiveness of their environmental, social, and governance practices, while also fostering a better future for everyone.
By using satellites and AI, ESG-savvy businesses can improve their operations, maintenance, and sustainability in geographically distributed assets. Core industries can make more informed decisions and optimize long-term plans while reducing costs, increasing reliability, and achieving their sustainability objectives.
Abhishek Singh is the cofounder and CEO of AiDash.