Digital transformation - ESG, use of IT outsourcing in programming for ESG investors
Modern technologies accompany us at every step. We constantly benefit from their achievements and gains - very often without realizing it. Digital transformation is constantly ongoing and progressing. New technologies are constantly being introduced to the market as part of it, thanks to them processes are being streamlined. More and more companies are realizing this and the need to "move with the times."
Many might say - "What digital transformation? After all, we already live in a digital world." That's right - but the current technological development is just the tip of the iceberg, it's just the beginning of what we will be able to afford in a while and what the reality around us will look like. We wrote about what digital transformation is in our article: Digital transformation - definition, opportunities and threats.
What does ESG mean?
The environmental factor is beginning to play an increasingly important role in the digital transformation. We are realizing the consequences of our actions on the planet. There is a shift in the direction of corporate strategy, with an even greater awareness of environmental, social responsibility and corporate governance (ESG) issues.
ESG - from English - so-called ESG issues - Environmental, Social and Governance issues is the consideration of three issues in the operations of companies: environmental, social and corporate governance. ESG has a very good impact on companies' operational efficiency, financial efficiency and overall value.
IT outsourcing and ESG - is it a good combination?
ESG has many positive consequences. First and foremost, it can help companies operate in a much more sustainable and socially responsible manner. The IT industry and the use of modern technologies help to better manage resources, collect detailed data, conduct analyses that examine the effectiveness and effects of the actions taken.
Outsourcing the answer to growing ESG demand
Corporate Social Responsibility, ESG, fits perfectly with the idea of outsourcing, as the outsourcing of processes to companies that have more experience in a given area, and consequently - will perform tasks much faster, more efficiently, more effectively. Such companies have the right competencies, knowledge, know-how to perform tasks better, with fewer resources, cheaper, faster, than if it were done in-house, in the company. This is fully consistent with the tenets of ESG - taking care of environmental, social and corporate governance issues.
ESG - the beneficial impact of IT outsourcing
What are the benefits of IT outsourcing in realizing ESG? How to use the various technologies? What does it look like in practice? Investment in cloud technologies, tools that support a hybrid work model or big data are able to contribute, for example, to reducing electricity consumption and allows the collection of data important from the perspective of reporting the achievement of ESG goals.
Digital transformation and ESG
Digital transformation, in the simplest terms, is the use of technology to transform what was once analog into digital. It refers more to the way technology has revolutionized how companies operate. This is occurring through new IT fields and areas, such as machine learning, cloud solutions, and datasets.
Taking ESG into account in a company's operations means, among other things, increasing the market value of the company's shares and investment attractiveness, increasing operational and financial efficiency. It also influences the identification of new carriers of value, unification of internal and external communications, introduces a better working environment, greater employee involvement, satisfaction, loyalty and productivity. Consequently, it ensures easier acquisition of employees and natural resources, reduction of transaction costs due to the trust of counterparties, on reputation building, strengthening the brand and good image of the company, increasing interest in it, favor, satisfaction and loyalty of customers.
Digital transformation with IT outsourcing
According to Ricoh 2021, "The link between investing in digital transformation and achieving ESG goals is seen by only 34% of respondents." On the other hand, the same research shows that customers, business partners and employees themselves have a high level of awareness and high expectations of corporations in this regard. Digital transformation using IT outsourcing is proving to be one of the most effective methods in achieving ESG goals.
Specialized IT companies already have ready-made solutions developed so that companies are able to implement sustainability ideas in their businesses. Environmental factors, corporate governance and social responsibility are now extremely important and desirable. Digital transformation makes this possible, and IT outsourcing provides ready-made solutions with which to implement these ideas. It is therefore worth considering how to combine ESG and IT outsourcing, as this has tangible positive effects for companies.