Deloitte has launched Sustainability Fusion, a framework through which companies can assess sustainability investments in financial terms. The idea is based on the premise that many ESG projects are justified on the grounds of impact, compliance or reputation, but are only approved by the board, the CFO or the investment committee if they can be compared with other business projects. This means costs, revenues, risks, cash flow, payback period and value created or protected.<\/p>\n
Sustainability Fusion is not a reporting standard and does not replace the ESRS, GRI or ISSB. Deloitte describes it as a solution comprising a strategic framework, consultancy services and digital assets, including an AI-based web-based assessment tool. It helps companies input a project\u2019s parameters and link them to financial levers. For companies, the benefit lies in translating a sustainability initiative into language familiar to capital decision-makers.<\/p>\n
Sustainability Fusion operates on three levels.<\/p>\n
The first level is value category<\/em>, that is, where the financial impact is felt. This may take the form of reduced costs, avoided costs, new revenue, protected revenue or reduced risks.<\/p>\n The second level consists of value levers<\/em>, that is, the mechanisms through which the project generates value. For example, reducing energy consumption, minimising material wastage, stabilising costs, retaining customers or reducing the risk of business disruption.<\/p>\n The third level consists of value dimensions<\/em> which shows how the value is measured. This includes the magnitude of the effect, the point in time at which it occurs, its duration, the assumptions, the scenarios and the degree of uncertainty.<\/p>\n This framework requires the company to move from general statements to a business case: what is changing, what is the value, when will the impact be felt, and how robust are the assumptions.<\/p>\n An investment in energy efficiency can be justified by the reduction in energy costs, lower emissions and reduced exposure to price volatility.<\/p>\n A renewable energy project for self-consumption can lead to savings on energy bills, greater cost predictability and a contribution towards decarbonisation targets.<\/p>\n A circular economy initiative can reduce material losses, waste management costs and dependence on virgin raw materials.<\/p>\n A climate adaptation project may be based on a different rationale: it does not necessarily generate new revenue, but it can prevent losses by protecting assets, reducing operational disruptions or maintaining delivery capacity.<\/p>\n A product with a lower carbon footprint can help secure access to customers with sustainable procurement criteria, safeguard existing contracts or create new business opportunities.<\/p>\n The first step is to take stock of sustainability projects. Many companies have dozens of initiatives relating to energy, waste, water, transport, packaging, suppliers, products, buildings, ESG data, biodiversity or climate adaptation. Not all of them are of equal value, and not all are ready for investment.<\/p>\n The second step is to define the categories of value. For each project, the company must determine whether value is created through cost reduction, new revenue, protected revenue, avoided risks or compliance.<\/p>\n The third step is to identify the levers. Here, the mechanism needs to be explained \u2013 that is, what changes in operations, costs, sales, customer relations, risks or access to finance.<\/p>\n The fourth step is financial modelling. The company needs to work with scenarios, payback periods, cash flow, sensitivity to assumptions and comparisons between projects.<\/p>\n The fifth step is to integrate sustainability into the capital allocation process. Sustainability projects should not be listed separately, with no link to financial planning. They must be analysed alongside the company\u2019s other investments.<\/p>","protected":false},"excerpt":{"rendered":" Deloitte a lansat Sustainability Fusion, un cadru prin care companiile pot evalua investi\u021biile \u00een sustenabilitate \u00een termeni financiari. Ideea de la care porne\u0219te de la premiza c\u0103 multe proiecte ESG sunt argumentate prin impact, conformare sau reputa\u021bie, dar ajung s\u0103 fie aprobate de board, CFO sau comitetul de investi\u021bii doar dac\u0103 pot fi comparate cu […]<\/p>\n","protected":false},"author":4,"featured_media":9723,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[9],"tags":[],"class_list":["post-10809","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-noutati"],"_links":{"self":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10809","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/comments?post=10809"}],"version-history":[{"count":3,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10809\/revisions"}],"predecessor-version":[{"id":10812,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/posts\/10809\/revisions\/10812"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/media\/9723"}],"wp:attachment":[{"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/media?parent=10809"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/categories?post=10809"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/esghub.ro\/en\/wp-json\/wp\/v2\/tags?post=10809"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Example<\/h2>\n
What a company should do<\/h2>\n