An eBook, sponsored by ServiceNow

THE SUSTAINABILITY IMPERATIVE 2022:

Driving ESG Impact and Value
Through Technology
RESEARCH BY:

Marta Muñoz
Stephen Elliot
Senior Research Director and Lead
Group Vice President, I&O, Cloud
Technology & Sustainability Practice,
Operations, and DevOps, IDC
IDC EMEA

Galina Spasova Bjoern Stengel

Research Manager, European Global Sustainability Research and
Imaging, Printing and Documents Practice Lead, Sustainable Strategies
Solutions (IPDS) Group, IDC and Technologies, IDC

Dan Versace
Randy Perry
Research Analyst, Environmental,
Vice President, Sales Enablement
Social, and Governance (ESG)
Practice, IDC
Business Services, IDC

January 2022 | IDC Doc. #US48505621

 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Table of Contents
Click on titles or page numbers to navigate to each section.

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The ESG Imperative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Drivers to Invest in ESG Today . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Challenges and Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Aligning a Technology Roadmap with ESG Leadership and Budgeting . . . . . . . . . . . . . . . . 11

Metrics Matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

C-SUITE VIEW: Creating an ESG Action Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Phase 1: Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Phase 2: Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Phase 3: Check . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Phase 4: Improve. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

About the Analysts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Message from the Sponsor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
2
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Executive Summary

Business today is interlinked with environmental, social, and governance (ESG)

responsibilities. The triple bottom line concept of people, planet, and profit is
becoming more commonly accepted by organizations worldwide with board
members looking at steering their organizations into purposeful actions.
C-suites are embracing ESG practices across their businesses, as they see the
impact of ESG not only on society and the environment, but also on improving
their operational and financial performance and increasing product innovation.

In September 2021, IDC conducted a global survey, sponsored by ServiceNow, with For further firmographics
senior executives to gather insight into their current ESG strategies and business of who was surveyed,
priorities leading into 2022. The results of this research provide critical executive please see the
insights into what is shaping ESG leadership, investments in enabling technologies, methodology section at
and intended outcomes. the end of this paper.

These include:
Worldwide, ESG has become a very or extremely important business priority
for 72% of organizations with 500+ employees. It is crucial for 98% of companies
with 5,000+ employees.

ESG drivers have become more linked to business value. While cost savings
through energy management was the top driver stated by 37% of respondents,
product innovation also surfaced as a leading driver by 34% of senior leaders.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 3
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Still, organizations face ongoing challenges, 74% state they lack ESG expertise/
capability, 61% say they lack the right IT tools to report and measure and 59% say
they donʼt have the necessary operational technologies.

While ESG strategy is a multifunction responsibility, 97% say that CIOs play an
important or major role in the delivery of ESG outcomes.

Technology is a key enabler. 85% say an integrated sustainability solution would

be a game changer for managing ESG-related business priorities.

To be successful, ESG investment can no longer be triggered by reactionary

compliance requirements or point solutions. Global customer, employee, social,
diversity, and climate demands continue to increase, impacting every business,
boardroom, and executive team. For a growing number of high-performing
organizations, business and technology leadership teams need to integrate people,
processes and technology to build an ESG Foundation. This paper lays out a 4
phased framework to accomplish just that.

N 2
LA CHNOLOGY .
TE
1. P

AC
T

ESG
FOUNDATION
PROC

LE
4. I M

OP

SE
ES

PE

CK

S
OV HE
PR

E 3. C

An ESG Foundation enables executives and teams to align ESG initiatives with the
business strategy and planning cycle, enabling companies to operationalize ESG into
their operating fabric. It also enables people to think differently about ESG; assessing
risks, opportunities and their unique role in planning, acting, checking, and improving
their organizationʼs ability to deliver ESG impact and ultimately tangible business value.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 4
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

The ESG Imperative

The terms sustainability and ESG are often used interchangeably, as both address
key challenges the world is currently facing. The individual ESG elements are
interconnected and important to define.

For this research:

Environmental includes topics such as energy consumption, natural resource
utilization, and waste (electronic waste and carbon emissions, for example) that
every company and its value chain create.

Social refers to topics such as employee attraction and retention; equitable labor
relations; diversity, equity, and inclusion practices, and community engagement.

Governance is the process for meeting objectives dictated by policies as

well as practices a business uses to enable, govern, measure and report on
decision making that supports internal values and complies with the interest of
external stakeholders, such as shareholders and regulators (such as executive
compensation including ESG parameters, internal carbon taxes, internal structures,
processes to ensure diversity and fairness, etc.)

The imperative is primarily being driven by large organizations.

IDCʼs survey results indicate that the importance of ESG increases as the size of an
organization increases: It is crucial for 98% of companies with 5,000 employees or
more compared to 45% of companies with 500 to 999 employees. This is often tied
to business and technology leadership teams that recognize the value creation from
ESG investments and their impact on stakeholders. From a purely financial impact
perspective, leadership teams are increasingly measuring ESG impact in terms
of top-line growth, cost reduction and containment, trust enablement, improved
transparency, risk mitigation, improvements in culture/mission alignment, and
employee engagement. These strategic imperatives should be at the forefront of
every C-suite executive decision-making process for new ESG opportunities for
long term value creation. Slowly, these objectives are also permeating into smaller
organizations who are often suppliers of the larger ones and therefore asked to
adhere to certain sustainability values.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 5
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Drivers to Invest in ESG Today

Organizations often cite their number one benefit from ESG investments as driving down
costs (derived from energy efficiencies). While cost implications are still an important driver,
they are closely followed by the need to establish a positive impact on brand reputation — in
other words, trust. This has considerable implications for C-level executives who are sending
the right — and credible — signals to a customer base that is increasingly discerning about
ESG intentions and execution. ESG strategies need to be strongly aligned and integrated into
business criteria and objectives to ensure continued investments and scalability, reducing
the risk of greenwashing claims and enabling brand reputation and trust.

FIGURE 1
ESG Drivers Vary by Region
(% of respondents)
Q: What are the main drivers for your organization investing in sustainability?

Total North America

Cost implications Executive management
37% mandate
40%
(e.g., energy savings)
Cost implications
Brand and trust driven 35% (e.g., energy savings)
37%

New product innovation 34% New product innovation 32%

Customer demand 33% Western Europe

Brand and trust driven 40%
Regulatory requirements 31%
Cost implications
Executive management 37%
mandate
30% (e.g., energy savings)
New product innovation 35%
Shift in corporate purpose 27%

Investor demand 22% Asia Pacific

Board of directors mandate 21% Brand and trust driven 43%

Employee demand 19% New product innovation 37%

Cost implications
Partner demand 12% (e.g., energy savings)
37%

Source: IDC ServiceNow Sustainability Survey, 2021

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 6
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Encouragingly, the ability to generate new product innovation is cited as the third
most important driver for organizations worldwide. This is often a consequence of
adapting design processes and production cycles to incorporate more sustainable
materials, to enable repair and remanufacture practices, and to create new business
models based on circular economy principles and “as a service” models.

In addition, investments in digital ESG tools often enable better governance structures
and processes, and improved data collection and tracking across teams for board,
C-suite, customer, regulatory, and investment reporting capabilities.

Furthermore, organizations today are looking to surround themselves with partners

that share their values and vision of a better world. The breadth and depth of partnersʼ
ESG initiatives is fast becoming a fundamental ingredient for organizationsʼ
decision-making criteria during their partner selection process with 60% of survey
respondents planning on investing a higher proportion of their technology budgets
with vendors that actively support their own ESG objectives. This again points to
trust-building within the ecosystem. IDC research also shows the procurement
function in global organizations increasingly incorporating aspects of sustainability
into their supplier selection process, ranging from supplier emission levels to supplier
diversity to human rights assurances.

Top Drivers per industry:

63 %
50 %
Education and Regulatory Executive management
Government requirements mandate

Finance
40 % Customer
demand 40 % New product
innovation

Manufacturing
46% Cost
41% Regulatory
requirements

Healthcare
52 % Cost
43 % New product
innovation

Retail
42% Customer
demand 42% Brand/image

60% 50%
Transport, Shift in corporate Customer
Communications, Utilities purpose demand

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 7
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Challenges and Opportunities

While a growing number of organizations are incorporating ESG principles into their
strategy and vision, an important gap remains between these corporate commitments
and the execution and operationalization of ESG objectives within the company.
Decision makers and senior executives refer to the following operational and
structural challenges when trying to act on their ESG objectives:

Operational Challenges
The lack of ESG expertise/capability is perceived as a top challenge for organizations, Almost all (99%) of
especially those trying to establish sustainability strategies and conduct materiality respondents would
assessments that require proficiencies outside the core competencies of traditional like an integrated
staff. In addition, the lack of IT tools to report and measure the companyʼs sustainability solution
sustainability policy impact — and that of their supply chain — is identified as the with 85% saying it would
second most important challenge. While a number of tools are beginning to emerge be highly valuable or
(carbon calculators, for example) many of these provide segmented information on a game changer.
specific emission drivers (such as cloud services, IT hardware, and employee travel)
and are mostly focused on the environmental aspects.

The availability of an integrated solution that can guide organizations through the
various stages of documenting material topics, setting goals and targets, defining
metrics, collecting metric-driven data from across the organization and generating
needed disclosures would simplify what can be today a resource- and time-intensive
process. Furthermore, there is a need for tools to incorporate regulatory aspects and
ensure auditable data across the different projects and initiatives, in order to facilitate
risk mitigation. A technology platform that can enable streamlined communications
and collaboration across teams and managerial layers will play a key role.

Although some of the necessary technology to avert a portion of the past and current
challenges is yet to be invented or needs to be more scalable, IT providers have made
considerable progress in creating solutions that provide transparency and control over
the initial step of measuring the current and future impact across all operations and the
wider supply chain.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 8
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Top Three Operational Challenges

74% 61% 59%

Lack of expertise/capability Lack of IT tools to report Absence of necessary
and measure operational technologies

Timing and Structural Challenges

One immediate challenge most organizations face is the need to demonstrate
short-term progress toward what can often be long-term goals and objectives
(into 2050 and beyond, commonly). As a result, the need to establish intermediate
targets and objectives in the short term and to quantify progress towards these has the
potential not only to act as a powerful differentiator, but also to secure future spend by
proving the return on investment from the individual ESG initiatives undertaken.

One common challenge many organizations acknowledge is the lack of unified

international standards for reporting ESG metrics, with over 50% of organizations
surveyed noting this as a key structural challenge. Despite international attempts
to simplify and unify some aspects of the standards landscape (with organizations
such as the European Union Taxonomy for Sustainable Finance and the International
Sustainability Standards Board), most private companies recognize that there is an
immediate need to take action and ensure alignment and comparability across
defined standards.

Top Three Structural Challenges

57% 55% 48%

Inability to prove ROI Lack of unified standards Lack of regulatory incentives

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 9
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Aligning a Technology Roadmap

with ESG Leadership and Budgeting

ESG leadership, accountability, and ownership is a shared responsibility across the

entire C-suite (see Figure 2). For success, most ESG challenges and opportunities
require executive stakeholders to collaborate and commit to long-term investment
and engagement. For example, regulatory compliance often requires performance
data from across C-suite stakeholders, empowered by multiple teams at lower levels
of the organization.

FIGURE 2
Which department currently has the ESG budget?
(% of respondents)
Q: What department has the highest share of your organizationʼs sustainability budget?

Dedicated sustainability team 28%

IT 27%

Operations 12%

Executive management 10%

Finance 10%

Marketing/Sales 7%

Human resources 6%

Source: IDC ServiceNow Sustainability Survey, 2021

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 10
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

That said, the technology foundation enables an enterprise-wide view of how The ability to digitize
the longer-term strategy is being operationalized, what the key challenges and processes and make
opportunities might be within environmental, social or governance focus areas, and work possible from
how initiatives and outcomes intersect. Leadership teams must understand their level anywhere is the most
of ESG maturity and the existence (or lack thereof) of governance structures within the important environmental
organization to support their ESG progress. impact of IT products
and services. This is
There is often an opportunity to integrate ESG practices and procedures into
closely followed by the
existing governance activities across business functions, in areas such as planning
ability to rightsize and
and strategy, reporting and dashboarding, human resources (HR) hiring practices,
run environmentally
hardware consolidation, asset management, energy management, procurement, and
efficient IT operations,
other business functions. In the case of governance, risk, and compliance (GRC), ESG
applications, and
has become an integral part for many organizations, which has led to the emergence
infrastructure and the
of integrated ESG/GRC risk-management solutions.
capacity to reuse, repair,
Therefore, technology as an enabler and the CIO as a sustainability champion play refurbish, and recycle IT
critical roles in the deployment and success of ESG initiatives. hardware assets.

Most (97%) of respondents believe that the CIO plays an

97% important role in enabling the collection, management, and
validation of ESG projects, outcomes, and impact.

By adopting a technology platform that empowers business (procurement, finance, One-third (32%) of
HR, etc.) and technology teams (development, customer support, operations, security, organizations intended
etc.) to manage and execute ESG projects, CIOs are at the center of enabling and to spend between
operationalizing ESG success. 10% to 30% of their IT
budgets in ESG-related
products and services
in 2021, and firms
have an expectation
to increase the share
of their IT budget
towards sustainability
by 3.7% in 2022.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 11
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Metrics Matter

As discussed earlier, ESG can feel daunting for practitioners to put into practice.
It is clear however that “you cannot manage what you donʼt measure”, so IDC asked
companies what their key performance metrics were — both from an environmental
angle as well as from social and governance perspectives. Not surprisingly, on the
environmental side, energy-management and risk-management metrics surfaced to
the top. From social and governance views, employee health and safety and data
security were key metrics being tracked.

FIGURE 3
Metrics that Matter
(% of respondents)
Q: With the current focus on climate change, for which Q: Besides environmental metrics, what other social or
of the following environmental metrics is your governance metrics is your organization currently
organization currently tracking its performance? tracking?

Energy management 61% Employee health and safety 59%

Risk management and climate
related financial disclosures 54% Data security 53%
impact of climate change
Customer privacy 50%
Waste management 50%
Workforce diversity and
inclusion
48%
Greenhouse gas emissions 45%
Systemic risk management 43%
Product design and lifecycle
management and supply chain
42%
Business ethics 42%
Ecosystem and biodiversity
Impact
42% Supply chain labor practices
and human rights
37%
Business model resilience 39%
Customer welfare 33%

Water management 39% Community relations 32%

Air quality 32% Competitive behavior 24%

Source: IDC ServiceNow Sustainability Survey, 2021

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 12
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

It is clear that an organization will need a systematic approach to incorporate key

metrics that are meaningful for their organization across the spectrum of ESG.
Each organization will need to decide what focus they will put on their metrics in the
quest to drive desired outcomes — be those waste management, product design,
inclusion, diversity, risk, employee health, or other incentives.

For the purpose of illustrating tangible steps of turning strategy into action, we will
dedicate the remainder of this paper to laying out a blueprint to integrating ESG into
business operations and showing how technology solutions can directly impact the
triple bottom line by accelerating business value creation.

Metrics in Action: A Case Example

To help quantify the energy savings in a real-world scenario, IDC conducted in-depth interviews with 25
ServiceNow customers to identify how better IT asset management enables a reduction in on-premises servers
and a reduction in PCs. These devices were eliminated, not moved to the cloud, through better management.
ServiceNow customers were able to reduce the number of their on-premises servers by 34% saving 77,000kWh
of energy consumption, reducing their carbon footprint by 49.9 tons of CO2e per 1,000 employees per year and,
in addition, reduce their PCs by 4%, saving 1,300kWh of energy and reducing their carbon footprint by 2.4 tons
of CO2e per 1,000 users per year. Stated in another way, the combined total reduction of 52.3 tons of CO2e is the
equivalent of 132,000 miles driven or 64 acres of forest per 1,000 employees. For a more detailed explanation
of this case example, please see Quantifying the Value of Reducing Energy Consumption and Greenhouse Gas
Emissions with ServiceNow, An IDC Solution Brief, Jan. 2022.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 13
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

C-SUITE VIEW:
Creating an ESG Action Plan

IDC outlines a four-step blueprint for leveraging technologies with workflows across teams
to deliver ESG outcomes (See Figure 4). It enables people to think differently about ESG by
continuously assessing both risks and opportunities. Importantly, it creates an integrated ESG
foundation that can help an organization overcome some of the operational and structural
challenges outlined earlier in this paper.

Defining the ESG Foundation

An ESG foundation has three ingredients: people, process, and technology that together create
a common, flexible core that embeds ESG capabilities into a companyʼs operating model. The
technology enables cultural and organizational change, providing transparency while advancing
process maturity and continuous team improvement during the ESG journey. People and
processes utilize the technology for ESG-centric tasks (i.e., data collection, metrics, analysis,
reporting, etc.) to provide transparency into the business impact and value from ESG.

FIGURE 4
A C-Suite Approach to Building an ESG Strategy Through People, Process and Technology

Identify key ESG stakeholders, Implement strategy; create

audience, and outcomes
Identify material ESG issues and
technology requirements
Define and set goals,
1. P
impact for all stakeholders
Automate the collection of
AN 2. metrics; analyze performance
L Create annual reporting; publish

AC

targets, key metrics; locate disclosures

data sources
Create an
T

ESG foundation
to build trust and
transparency with
4. I M

Integrate and manage all stakeholders Pinpoint performance and data

CK

ESG risks, product gaps across teams

OV E
PR

innovation Observe the effect of change

Establish ESG policies;
E C H from outcomes
train/retrain teams 3. Audit ESG processes; empower
Communicate successes governance with unified data

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 14
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Phase 1: Plan
To drive integrated processes and procedures, the importance of planning cannot
be understated. Planning and integrating ESG initiatives across the organizational
constructs, leadership teams, and operational staff effectively drive the collection,
sharing, and contextualization of data. This enables executives to gauge progress and
prioritize ESG projects and investments alongside or as part of other business plans
and operations. For global organizations, planning becomes paramount as regulatory
models differ by region and therefore create differing demands for reporting.
Using the right technologies (and workflows) can drive consistency and
standardization across key ESG areas such as stakeholder (and shareholder)
transparency and reporting, workforce diversity, emissions controls, regulator data
requirements, and workforce health, among other areas.

ESG Executive Recommendations

Identify material ESG issues that your organization needs to address and manage.
Issues vary widely by company and considering their impact on the organization
and stakeholders is critical for a strategic ESG approach.

Proactively engage with internal ESG stakeholders across business, technology,

and operational functions, and establish expectations and a support structure by
defining issues and capability gaps, business risks, and opportunities as they relate
to ESG goals and outcomes.

Determine which ESG issues the company has already been managing without a
formal ESG strategy and celebrate progress in those areas.

Encourage and obtain employee buy-in across all functional departments;

define employee engagement activities across ESG topics to assign
responsibilities, and nurture a culture that delivers positive ESG outcomes
and continuous improvement.

Define goals and targets (ESG key performance indicators) across the relevant
teams.

Integrate ESG with day to day business ops and company culture.

EXAMPLE

Planning and integrating hardware asset management technology and processes can enable the proper
tracking of energy usage, the reuse, remanufacturing and responsible recycling of used and depreciated
IT hardware, and a sustainability connection between the employee and their environmental impact.
This information (energy and asset use, recycling) becomes critical for sustainability objectives and
empowers IT to work with procurement, workplace services, and sustainability offices to align objectives,
map outcomes, and reuse data for environmental- and regulatory-specific requirements.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 15
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Phase 2: Act
Use the technology platform and processes to refine ESG metrics and outcomes that
are aligned to organizationsʼ overall strategies. ESG metrics should not be considered
a “tax” on doing business but rather an enabler to drive business value. That said,
defining metrics is critical for achieving ESG goals, but having too many metrics can
cause confusion and lack of focus. In addition to metrics, identify the key workflows (and
associated stakeholders and teams) that drive desired outcomes to promote real change.

ESG Executive Recommendations

Identify if current IT monitoring, dashboards and reporting mechanisms can be
extended to include ESG-metric tracking, goals, targets, data collection, and
executive dashboarding in context for each audience (executive management, board
of directors, customers, investors, government regulators, rankers and raters, etc.)

Connect people, systems, and functions (including employees, customers, and

partners) across the enterprise to activate the changes required in a cost-optimized
manner to meet ESG goals.

Match relevant data with the workflows that can operationalize the collection and
dashboarding of ESG metrics.

Integrate ESG into day-to-day business operations to drive operational effectiveness

in order to deliver rapid time to value and impact.

EXAMPLE

Social and diversity requirements are often supported through HR technologies that collect information
from across the organization and enable a positive and productive employee experience. Recent
examples include the ability to have a safe return to the workplace for employees, and the broader theme
of employee health and safety. This use case requires connecting people, systems, and functions across
an organization to deliver outcomes and create opportunities for advancements.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 16
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Phase 3: Check
Consider data disclosure and its related requirements for effective data collection,
analysis and processing. The data can be HR and IT management sourced as well as
from third-party streams such as ratings orgs or supply chain partners. For example,
the ability to implement changes that drive successful environmental outcomes can
exist across a core set of energy, regulatory, waste generation, and carbon emissions
initiatives. Pinpointing data and performance gaps across teams becomes paramount to
checking progress and establishing improvement opportunities.

ESG Executive Recommendations

Identify data collection, processing, and reporting protocols.

Increase data quality and accuracy for measuring ESG success and progress.

Enhance ESG data reporting and access with streamlined data collection and
contextual dashboards.

Empower governance-, risk-, and compliance-based decisions across the enterprise

with a unified data environment.

Give the sustainability frontline team easy access to insights and tasks via mobile
apps, reporting, and dashboards.

Ensure that the ESG data gets to the right people via an auditable and
transparent process.

EXAMPLE

Given the complexity of sustainability projects, we recommend using collaborative project-management

technology tools and strategic portfolio and project management technologies to plan, execute, and track
them. The technology can help identify ESG-related performance gaps, cost concerns, and process and
project transparency. A common sustainability project involves reducing greenhouse gas emissions by
working with teams that manage real estate, data center facilities, procurement, asset management, and
energy management, to create a repeatable data-driven model.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 17
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Phase 4: Improve
Executives should focus on creating policies and procedures that interlock ESG
initiatives with their associated business risks as well as the opportunity for product
innovation. Monitoring, measuring, and reporting on ESG key performance indicators
requires quality data and solid communications across teams and with executive
stakeholders. This phase presents an opportunity to train or retrain stakeholders
towards new behaviors, adoption of new processes, adapting to changing regulatory
requirements, and use of new technologies to deliver ESG improvements.

ESG Executive Recommendations

Ensure ESG project implementations through policies and guardrails across asset,
discovery, and inventory solutions and processes, mapping to key stakeholders.

Automate the data collection process used to support ESG initiatives, policies,
and governance guardrails; identify new data sources and stakeholders if required.

Reuse some of the data captured in the discovery and inventory processes, and
data stores, for ESG reporting, analysis, and disclosures.

Use ESG performance improvements and reports to show executive management

and investors how the company mitigates risks and generates sustainable
competitive advantages from ESG outcomes.

EXAMPLE

The use of integrated risk-management technology can enable the move away from manual,
spreadsheet-based data collection to automated processes. Creating an ESG data platform that
enables teams to collect and analyze ESG data from different functional teams on an ongoing basis
drives transparency and increased confidence in the accuracy of trending and performance statistics.
It also provides a foundation for data-driven discussions that can lead to improvement opportunities
across ESG initiatives.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 18
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Conclusion

Stakeholder focus on environmental, social, and governance initiatives is here to stay;

companies and their executive teams must make the proper investments across people,
processes, technology, and outcomes to enable organizational reputation and enhance
value creation across the enterprise. ESG considerations are increasingly becoming
part of the purchase decisions for products and services; ESG is now intertwined with
revenue growth and profitability.

The time for action is now, as many CEOs now consider their technology architecture to
be their business architecture. Now, more than ever, technology is enabling ESG success,
delivering data collection and access, collaboration, reporting, and baselining capabilities
across ESG metrics and processes, empowering business and technology teams to
deliver powerful, transformational information, fast and at scale.

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 19
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Methodology

In September of 2021, IDC conducted a survey of 305 larger organizations covering

several regions and countries. Respondents were C-level and senior-level executives
responsible for sustainability decisions and initiatives within their companies.

Region

22% North America: USA, Canada

43%
Western Europe: England, Germany

Asia Pacific: Australia, New Zealand, Singapore

35%

Primary business Number of employees

Technology 18%

Finance 15%
18% 41% 41%
500 – 999 1,000 – 4,999 > 5,000
Business or professional
services
15%

Retail or wholesale 14% Current title or role

Process manufacturing 7%
30% 24% 20%
Discrete manufacturing 6% SVP/VP/Director SVP/VP/Director SVP/VP/Director
Operations IT Sales/Marketing

Healthcare 5%

Energy 5% 13% 13%

Other SVP/VP CXO

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 20
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

About the Analysts

Stephen Elliot Marta Muñoz
Group Vice President, I&O, Cloud Senior Research Director and Lead
Operations, and DevOps, IDC Technology & Sustainability Practice,
IDC EMEA

More about Stephen Elliot More about Marta Muñoz

Galina Spasova Bjoern Stengel

Research Manager, European Global Sustainability Research and
Imaging, Printing and Documents Practice Lead, Sustainable Strategies
Solutions (IPDS) Group, IDC and Technologies, IDC

More about Galina Spasova More about Bjoern Stengel

Randy Perry Dan Versace

Vice President, Sales Enablement Research Analyst, Environmental,
Practice, IDC Social, and Governance (ESG)
Business Services, IDC

More about Randy Perry More about Dan Versace

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 21
 The Sustainability Imperative 2022: Driving ESG Impact and Value Through Technology

Message from
the Sponsor
ServiceNow believes that together we can workflow a more sustainable,
equitable, and ethical world. ServiceNow can be your platform for ESG
impact, connecting environmental, social, and governance use cases with
an operational control tower that helps you efficiently plan, manage, govern,
and report on ESG. Workflow with us to mobilize your ESG strategy, build
transparency and trust, and deliver long-term value and impact.

To learn more, please visit: www.servicenow.com/esgsolutions

An eBook, sponsored by ServiceNow

January 2022 | Doc. #US48505621
Table of Contents 22
This publication was produced by IDC Custom Solutions. As a premier global provider of market
intelligence, advisory services, and events for the information technology, telecommunications,
and consumer technology markets, IDCʼs Custom Solutions group helps clients plan, market, sell,
and succeed in the global marketplace. We create actionable market intelligence and influential
content marketing programs that yield measurable results.

@idc @idc idc.com

© 2022 IDC Research, Inc. IDC materials are licensed for external use, and in no way does the use or publication
of IDC research indicate IDCʼs endorsement of the sponsorʼs or licenseeʼs products or strategies.
Privacy Policy | CCPA