Operationalizing Environment, Social, & Governance (ESG) Principles
Implementing and Sustaining ESG principles into Day-to-Day Asset Management Activities
Overview
Corporate responsibility is no longer something reserved for top management. It is now being pushed down and across the organization, as more companies are implementing and practicing Environment, Social, and Governance (ESG) principles enterprise-wide. Fortunately, there is a high level of correlation between ESG principles and asset management improvement programs, such as reliability engineering, criticality assessment, preventive maintenance strategies, asset health (or condition) monitoring, and risk calculation.
Organizations must consider how their daily operations and decision making ensure:
- Respect for the environment
- Employee and public health and safety is the top priority
- Operational impacts on the community are understood and the public is engaged
- Management oversight systems represent the facts on the ground and enable course correction if needed
ESG from an Operational Perspective
There are many strategic activities that organizations should undertake to advance ESG; however, there are key asset management elements that can be considered foundational and common to all three streams of ESG:
- Criticality assessment
- Maintenance strategy design and optimization
- Asset health determination
- Risk calculation
- Risk-based decision making
Weaving ESG principles into these foundational elements are crucial to ensuring that these principles are operationalized, sustained, and pervasive in an asset-intensive business. The following chart summaries how ESG and asset management elements are connected to each other:
Achieving specific ESG objectives requires multiple asset management competencies. The identification of asset management competencies necessary to achieve ESG goals is not difficult; however, assessing present state, designing roadmaps, and deploying these competencies can be challenging for many organizations. Nevertheless, the prize is great. Doing due diligence of the ESG plan and its compliance is of strategic importance; and naturally, operational effectiveness, reliability, and profitability are important to all organizations.
Not Sure Where to Start?
This level of organizational involvement can be daunting; however, it can also lead to enhanced overall performance. There are roadmaps you can follow to connect the dots between asset management and ESG objectives, making this transformation easier. Allied Reliability can help align asset management processes, systems, data, and analytics to your ESG objectives.
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For more detailed information, refer to our white paper, Designing Environment, Social, and Governance (ESG) Principles within an Asset Management Framework.
ABOUT ALLIED RELIABILITY
Allied Reliability provides asset management consulting and predictive maintenance solutions across the lifecycle of your production assets to deliver required throughput at lowest operating cost while managing asset risk. We do this by partnering with our clients, applying our proven asset management methodology, and leveraging decades of practitioner experience across more verticals than any other provider. Our asset management solutions include Consulting & Training, Condition-based Maintenance, Industrial Staffing, Electrical Services, and Machine Reliability.
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