ESG Plan Design and Implementation
How Do We Develop an ESG Plan?
The need for both financial and non-financial groups to disclosure and address climate-related risks has become increasingly important as we better understand both the short-term and long-term economic and social consequences of greenhouse gas emissions. As businesses consider changing their operating model to support a lower-carbon economy, a new corporate governance and investments framework has been recommended by entities such as the Task Force on Climate-related Financial Disclosures identifying four key areas of climate-risk related disclosure alongside financial disclosures.
These four recommended areas of disclosure represent core elements of how organizations operate, and have are designed to focus on addressing the climate-related risks and opportunities embedded in each element of disclosure.
What options do we have for GHG emission reductions?
Now that you have your ESG plan in place, what next? There are a wide range of options to allow business to reach their climate goals, whether your goal is carbon neutrality (financing reductions outside your value chain) or achieving net zero (reducing emissions within your facility and value chain), ALG can assist you in taking the next step to achieve your climate goals:
Purchasing credits from the Carbon Market;
Investing in LCFS projects;
Evaluate new and emerging project ideas to self-implement;
ALG’s dedicated ESG practitioners have helped clients in both emerging businesses and established industries navigate through carbon credit program requirements. Once established, carbon credits are tradeable, either through agency Cap-and-Trade or LCFS programs, or private carbon trading exchanges such as AirCarbon Exchange (ACX) and CBL Markets (Xpansiv). ALG’s technical expertise allows our clients to navigate through GHG credit schemes and select the scheme that best matches the benefits of an emerging technology, carbon-neutral fuel, or capture/sequestration opportunity.
What does the Carbon Credit Market offer?
The carbon credit market offers companies the potential to monetize GHG emissions reductions if they:
Voluntarily reduce GHG emissions below a regulatory standard or limit;
Produce a low carbon fuel with a carbon intensity below a Low Carbon Fuel Standard (LCFS) benchmark; or,
Remove GHG emissions from the atmosphere (e.g., carbon capture and storage/sequestration).
Identification and Tracking of Key Performance Indicators
ALG routinely provides gap assessments to non-financial groups to help them determine the effectiveness of their efforts in achieving corporate ESG goals. ALG’s gap assessments benchmark corporate sustainability strategies and ESG targets and either confirm that the company is on the right path to achieving its goals or identify opportunities for improvement. We understand that every organization has a unique path to sustainability; accordingly, we recommend implementing focused and sequential gap assessments to achieve success. It is our direct experience that this approach is more cost-effective and provides greater strategic benefits than a company-wide gap assessment. We develop thoughtful gap assessment recommendations that can be easily implemented, leverage existing corporate data, reduce project or operating costs, and minimize risks inherent in advancing new corporate sustainability goals.