2023 will be a pivotal year for ESG strategies as organisations’ with competing pressures are reviewing short term goals to survive the economic crisis and long-term goals to continue to align business and ESG goals. There is a huge opportunity for the FinTech sector to use your innovation and creativity to support organisations and make a positive impact on the world.
ESG - FinTech Companies Can Help Lead the Way
Written By: John Ellis – 2 min read
Here we’ll explore why the FinTech sector should pay attention to ESG. We’ll talk about by strategically leveraging technological know-how, the FinTech sector can contribute towards a more sustainable future while also maintaining a competitive edge.
By understanding the challenges organisations are facing the FinTech sector can step up to the challenge and lead the way. As we’re all aware organisations around the globe are experiencing the pressures from a global pandemic, wars, famine, fires, floods and droughts compounded by the economic challenges of cost-of-living crisis, energy crisis and inflation. Furthermore, organisations are expected to meet impending deadlines related to disclosures and regulatory requirements to ensure a sustainable future for all.
Companies of all shapes and sizes across every sector are starting to recognise the importance of applying financial and non-financial factors to their approach to business. Each company can recognise a wide range of potential benefits that come with incorporating ESG. Business benefits such as ensuring compliance, accessing investment, enhanced reputation plus surprising cost savings, operational efficiencies leading to growth opportunities.
Organisations, however, lack the time, money, and resources – now more than ever- therefore are struggling to embed ESG into their corporate strategies despite the regulatory and consumer pressures they face.
In addition to the hurdles highlighted above, Boards are expected to be more transparent across ESG activities. This is difficult when there is a clutter of information and a lack of standardisation across jurisdictions each with different priorities.
That’s where the FinTech sector can step in with innovative platforms to quickly enable data-driven, ESG-focused solutions while preserving profitability. Companies can access tools to measure its climate impact, improve their environmental practices and give consumers and governments transparent information about impact of their products andservices.
How Fintech community can help
FinTech sector has an important role to play in assisting the transition into greener, fairer economies with ‘tools’ targeting solutions. In turn, FinTech’s innovative solutions can create opportunity that generates revenue, create jobs, and gain the competitive edge.
Tech tools can aggregate data to aid analysis, provide valuable insights that can go beyond traditional financial metrics. This empirical data can be used both internally by organisations to shape their financial and ESG strategies and shared widely with industry peers, academics and governing bodies who can work collectively to measure, monitor and effect change positively – faster.
We are already seeing many fintech start-ups emerge that are focused on sustainability, efficiencies and helping organisations save money. This is especially true when it comes to green finance solutions to measure energy consumption and mitigate their climate impact; utilise renewable energy such as solar or wind power to reduce utility bills while also providing a source of clean energy that is less likely to be impacted by price fluctuations.
Additionally, reducing business waste through recycling programs or investing in energy- efficient equipment can save on disposal costs while helping reduce carbon emissions.
Ultimately, ESG-centric thinking provides an opportunity for FinTechs to meet the needs of your customers in a meaningful and impactful way. Show your customers sustainable solutions are no longer just a nice-to-have; rather, they are quickly becoming essential tools for better business. Show the world, the FinTech sector develops tools and financial solutions that benefit businesses, consumers and society as a whole.
To succeed in this new landscape, the FinTech sector must stay up to date with ESG rapidly evolving trends so why not join our ESG community on Pulse Market for access to experts, knowledge sharing and ESG certification.
Published on 27 JANUARY 2023