The second Network Impact Report from Ecovadis showcases how they are continually working to measure and scale impact across their ratings network.
EcoVadis set out 15 years ago to help companies use sustainability intelligence to make business decisions that not only improve their bottom line but also communities, people’s lives and the planet we all depend on. A decade and a half later, we’re ramping up our efforts as we witness the growing pressure on corporate and political leaders to translate ambition into positive social and environmental impact. The time for signaling “ambition” has run out and “planning” and “target setting” are no longer enough. Now, more than ever, “implementation” and “impact” must be the watchwords for effective corporate sustainability governance going forward. Here’s a snapshot of how we’re helping companies take action and drive impact throughout their value chains.
Influencing Change At the Top of the Value Chain
Buying companies, or requesting organizations, are key change agents in the first phase of the EcoVadis model for impact. By embedding sustainability within their procurement strategy, policies, and processes, these organizations signal to their partners up the supply chain that sustainability is a priority and a prerequisite for doing business.
In 2021, we achieved the following progress in the first phase of our network impact model:
- 47,000 buyers (+104% from 2020) from 750 purchasing organizations (+67% from 2020 engaged on the EcoVadis platform in 44 countries and 53 industries.
- 53% (+18% from 2020) of requesting companies now include an EcoVadis Rating as a weighted criterion in RFPs.
- $2 trillion (+49% from 2020) of our buying customers’ global spend is screened by EcoVadis Ratings.
Unlocking the Positive Impact Embedded Within the Value Chain
For all the progress that buying organizations can achieve through the refinement of internal sustainability management systems and collaboration at the industry level, the key to unlocking positive impact at maximal scale is embedded in the value chain. Suppliers, or rated companies, play a critical role as change agents in the EcoVadis network. By adopting more sustainable practices at every stage of their operations, suppliers impact their own business network, including up and down their supply chain.
Over the past year, rated companies have made strides in a number of key sustainability areas:
1,106 companies using or producing renewable energy +30% vs. 2020
1,503 companies with training on energy management +26% vs. 2020
1,980 companies with reuse/recycle measures +54% vs. 2020
3,804 companies providing personal protective equipment +83% vs. 2020
2,941 companies providing diversity training +47% vs. 2020
1,644 companies with equality programs +198% vs. 2020
Scaling Up Our Impact
In addition to constantly expanding the number of companies engaged in the ratings network, EcoVadis has made critical investments to increase both the scale of our ratings solution – growing its range of use cases – and the depth and richness of the data and intelligence provided to customers.
Here are some of the ways we scaled impact in 2021:
Carbon Action Module
The Carbon Action Module was specifically designed to support companies in identifying their emissions across all scopes and driving reductions. At the heart of the solution are carbon scorecards, generated through an in-depth assessment process, that enable customers to gauge the maturity of their GHG management systems and identify opportunities to improve their performance. Our customers also use carbon scorecards to monitor the performance of their trading partners, as they embark together on a decarbonization journey.
More than 5,000 scorecards published since the module launched in 2021.
There is significant room for improvement among companies, as only 7.5% of those scored have published a GHG emissions reduction target.
Our newly launched EcoVadis Academy helps organizations tap into the knowledge we’ve gained through analyzing over 125,000 scorecards and working with our extensive network. The e-learning platform enables EcoVadis customers to drive improvement in a number of key sustainability areas related to the environment, labor and human rights, ethics and sustainable procurement.
For example, to further support companies that have utilized the Carbon Action Module, the EcoVadis Academy offers a dedicated course on GHG management.
Offering for Private Equity Firms
EcoVadis is now helping PE firms create value by giving them insight into the ESG performance of their portfolio companies (portcos) and enabling them to benchmark this performance against that of 80,000 private companies in the network. This enables firms to set their portcos on a more sustainable trajectory and drive improvements that can translate into a better EcoVadis Rating and, potentially, greater value upon exit. EcoVadis further supports PE firms in consolidating and verifying ESG data for the entire portfolio, enabling them to demonstrate their actions to their limited partners and regulators and adhere to standardized reporting requirements such as the UN Global Compact.
Next Steps in Our Journey
Over the past year, EcoVadis has achieved significant progress in developing metrics and methodologies to quantify and transparently disclose the positive environmental and social impacts generated throughout our network. But this is just the beginning of our journey in measuring and reporting on our impact. We will continually work to expand the breadth and range of the KPIs monitored to more accurately quantify and disclose on impact.
Read the Network Impact Report for the full picture.