Sustainable reporting with AI
The key to greater sustainability and added value
In an increasingly regulated corporate landscape, sustainability reporting is not only an obligation, but also an opportunity. The EU and numerous governments have set ambitious climate protection and circular economy targets. Companies are required to make their contribution and report on their activities. The pressure to provide transparent and reliable data on environmental, social and governance (ESG) aspects is growing. How can companies fulfill compliance requirements, design their reporting processes efficiently and operate sustainably?
The increasing demands on companies for more transparency with regard to global supply chains, environmental impact, diversity and other ESG data are constantly being reinforced by national and international regulations. Regulation is developing dynamically, which poses considerable challenges for the companies concerned. Innovative approaches are needed to respond to these developments appropriately. Artificial intelligence (AI) has already demonstrated significant efficiency gains in numerous areas. In sustainability reporting in particular, the use of AI makes a crucial contribution to achieving both ecological and economic goals, thereby making a significant contribution to greater sustainability and value creation.
Sustainability affects everyone
The challenge with regard to sustainability reporting often lies in the fact that existing knowledge is distributed across different sources. After all, sustainability affects everyone: occupational safety, HR, development, purchasing, sales, controlling, the works council and many more. This brings together a lot of data in a wide variety of formats and qualities, which ultimately have to be linked in sustainability management. Combining all of these data points to form a coherent overall picture ties up resources that are not available in abundance anyway. Access to the required information is time-consuming and inhibits efficiency and the ability to establish relevant links between the information. Small and medium-sized companies in particular need comprehensive support and efficient solutions. At this point, AI-supported approaches offer considerable potential for automating and optimising sustainability reporting processes.
Implementing AI sustainably
The biggest advantage is obvious: AI reduces the need for manual activities by automating processes. With the help of AI, large amounts of information can be quickly and logically linked through extraction and classification. This allows companies to carry out a quick check for preliminary assessments, for example. The integration of additional expertise and specialist knowledge increases the accuracy of analyses and better prepares companies for regulatory requirements. Implementing AI into the reporting process enables companies to monitor and analyse their sustainability practices and risks along the entire value chain. By automating workflows, sustainability teams can interpret data quickly and accurately.
Potential of AI-supported materiality analysis
The implementation goes beyond purely technical aspects. In terms of a holistic approach, it is advisable to supplement technological expertise with comprehensive knowledge within the company from the fields of business administration, law, regulation and strategic management. But where to start? The materiality analysis is a good starting point for AI integration, as it is the centrepiece of every CSRD project. It sets the focus and defines the core topics that are relevant for stakeholders as well as for economic, social and environmental impacts. At this stage of the process, it is crucial to keep the complexity of data identification and collection under control. The use of a structured and user-friendly application enables the efficient identification and assessment of impacts, risks and opportunities. This not only leads to higher data quality, but also simplifies and promotes improved collaboration between departments and stakeholders. AI-based applications that take into account standard factors such as industry affiliation, business model or location can undoubtedly help to democratise and simplify the process. Such solutions not only offer ease of use, but also the necessary documentation that is crucial to fulfil legal requirements.
Efficiency with AI
Another aspect that speaks in favour of using AI is its cost efficiency. Of course, the initial investment required for implementation is not negligible. In the medium term, however, the applications offer enormous savings potential. At the same time, AI can also create economic added value. AI-supported applications are able to uncover gaps in sustainability management. Where can processes be optimised? Which products or services can be made more sustainable? The focus here is not only on corporate sustainability goals, such as optimising production processes or reducing waste for more sustainable business operations. AI-supported sustainability management enables companies to measure the status quo more accurately and adjust their long-term objectives. The optimisation of operating plans or even their own decarbonisation strategy are just two practical examples. Companies that push ahead with digitalisation and AI make an important contribution to climate protection, while also being able to operate sustainably in the long term.
In addition, the integration of AI into the reporting process offers the opportunity to increase the efficiency of sustainability reports. AI-supported applications not only make it easier to collect data, but also to analyse and report on it. A major advantage: after all, if the CSRD were to be implemented in the future, the high requirements would result in considerable costs for the companies concerned. This is because adapting internal processes for initial reporting involves considerable effort. In addition, there are annual costs for sustainability management. Companies that rely on AI-supported sustainability reporting from the outset can therefore gain a decisive advantage.
Not an option, a necessity
The use of AI in sustainability reporting is correspondingly promising. Gaps are uncovered and the value chain can be organised more economically. Furthermore, it should not be neglected that younger employees in particular value the use of innovative technologies. Companies that use AI effectively are perceived as more modern and attractive and find it easier to attract and retain talent. Despite all the benefits, it is equally important to analyse the ecological impact of AI, as the consumption of resources can be significant due to computing power and energy. In the long term, the implementation of AI-supported tools is not just an option, but a necessity for sustainable companies. Companies that embark on this path now and integrate AI into their sustainability management will gain a critical advantage.
