The episodes of Aalto EE’s “Riding the Financial Wave” mini-podcast series concentrating on financial management and leadership address what aspects business leaders should focus on to ensure their companies remain competitive in the future. In the episode released at the end of April 2024, the discussion focused on sustainability disruptions and EU sustainability reporting requirements. Jukka Honkaniemi from the esgResilience team had the pleasure of sharing his insights and expertise on this critical subject.
Corporate Sustainability Reporting Directive (CSRD) came into effect at the beginning of 2024. It directly affects large corporations, but its impacts also indirectly extend to small and medium-sized businesses (SMEs). CSRD is much discussed and thus there is currently an urgency among SMEs as many do not know what is expected of them and when. More pressure for sustainability reporting is coming from the financial sector as banks are increasingly required to assess the climate risks in their lending portfolios.
The discussion in this mini-podcast underlines the essential role of SMEs in the green transition, noting the need for cost-effective strategies to help SMEs deal with stakeholder expectations and to include them fully in sustainability transition. It highlights the increasing demands from stakeholders, especially the financial sector, on assessing climate and ESG risks and the necessity for accurate data to manage financial stability. Without real data, risk assessments become conservative, potentially leading to reduced lending to SMEs, which rely heavily on banks. It is important for businesses to understand the economic effects of this transition. Jukka advocates for networking, education, and the use of cost-effective tools like esgResilience that has been designed to democratize reporting and analytics within the SME sector.
"Every industry will undergo more disruptions in the next ten years than in past decades"
"Successful green transition can only be achieved if also small and medium-sized enterprises are actively involved"
Here is the link to the full content for more details. Please note that the recording is in Finnish: Aalto EE minipodcast
