How can manufacturers get ahead of ESG requirements?

The concerns are coming at manufacturing leaders from all sides. With more and more socially conscious investors focusing on environmental, social, and corporate governance (ESG) when making investment decisions, manufacturers need to have ESG requirements at the top of their minds with regard to investor relations.

This trend increases the already mounting pressure on customers and partners to adopt green manufacturing practices. With greenhouse gas (GHG) regulations also coming, manufacturers must get to work on emissions – both reducing and reporting.

Though regulators from across the globe are still hammering out benchmarks for emissions and independent investor groups will assess ESG requirements differently, the three established emission scopes offer benchmarks to manufacturers for measuring the success of green manufacturing initiatives:

  • Scope 1 emissions occur from sources directly controlled by a company.
  • Scope 2 refers to greenhouse gas emissions released from the indirect consumption of energy.
  • Scope 3 emissions are the combined scope 1 and 2 emissions from organizations that are part of the manufacturer’s supply chain.

It is a challenging data problem. Collecting complete data on all three scopes requires interaction between manufacturing sites and supply chain partners. They are scattered all over the planet and use different data collection and storage standards.

Better data makes reporting on green manufacturing initiatives easier

To meet evolving ESG requirements and emerging regulatory mandates, manufacturers must collect more accurate production data from all of their production lines and facilities. The industrial Internet of Things (IIoT) and smart factory initiatives offer them the foundational tools needed to address looming GHG reporting requirements.

Connectivity is the key to making IIoT work on the factory floor, but generic IIoT solutions are not ready for factory floor requirements. It will take significant effort to customize for each application. Arch offers a robust connector toolbox that helps manufacturers collect machine data from every machine on the line.

With all available production data put to use, the ArchFX platform puts today’s real-time data in historical context, improving data visibility on a global scale and helping manufacturers understand where GHG emissions are being created.

The time to prepare for sustainability regulations is now. Learn more about our robust solution that can find ways to both increase efficiency and reduce emissions.