About this ATALK
In this enlightening episode of ATALKS, we are joined by Aron Belinky, Leading Partner at ABC Associados. Aron shares his insights on the rapidly evolving landscape of sustainability, focusing on the value of data, the role of investors, and the urgency of societal transformation.
This episode delves into:
- The transition from human-read reports to machine-interpreted data: Aron discusses the shift in how sustainability reports are being read and interpreted, moving from human analysis to smart machines and algorithms.
- Understanding the diverse nature of investors: Aron emphasizes the importance of recognizing the diversity among investors, their different perspectives, and how this impacts the concept of materiality in sustainability reporting
- The urgency of societal transformation: Aron underscores the urgent need for a shift in our society’s production and consumption patterns to ensure the planet’s resources and environmental services can sustain us.
- The importance of selecting the right tools and methodologies: Aron highlights the need to choose appropriate tools and methodologies for sustainability, keeping in mind the CIDI Framework (Connection, Integration, Dimension, Inclusion) and its relevance to the SDG’s and the 2030 agenda.
Join us as we navigate the complex world of sustainability with Aron Belinky, gaining valuable insights into the changing dynamics of data, investors, and societal transformation.
You can find the full transcript of their conversation below.
Really a challenge to talk after these amazing panels that we just saw. I was following them online. And congratulations to APLANET for convening this very insightful and very interesting conversation.
Listening to what Alicia, Ricardo, Carlos, Martin, Ed, Andrea were saying, it’s difficult to find new topics to comment on because it was really, really a very updated and insightful conversation. And I believe this is something that would really provide a very good guidance for everyone that’s trying to identify, to find your way into this moving and changing landscape of sustainability nowadays.
And I think that looking at the challenge to comment on this my, I’ll take three points which I think are interrelated and that can help us to make some sense out of this let’s say scenario that we have just heard about.
The first thing, a very practical a more pragmatic one is about the value of data and the way gathering information and organizing information to be used by different players will move forward.
So we come from a history of producing reports that used to be read by human individuals and analyzed by a number of attributes and perspectives that different persons would have. And we are now moving very quickly to a situation where the information the reports will be read and interpreted by machines, very new smart machines and algorithms. But companies reporting should bear in mind how to provide the data in this different scenario and how to provide sensible and reasonable information for this kind of different analysis that will start moving.
So I think this is something that in the challenge for companies that are used to report, they will have to face this change in the ways information is provided and also the timing for that will be very different because for machines, the idea is not to have the see annual report, but rather to have a repository where the algorithm can gather the data and analyze it in more continuous basis.
So I think that we will see a very big tendency in data tagging and trying to make the connections between the kind of data produced by the companies and the different frameworks and standards that are much more accurate and much more strict than frameworks that can be used.
So I think that this treasury of managing data and providing ESG data will be a very important range or area for people to to work on. So that’s the first point I’d like to emphasize.
The second point is about the idea that’s in the background of this whole conversation, which is a main, a key stakeholder which are the investors. So we are talking all the time about what the investor needs, how the investor makes decisions and how everything that’s being produced will be used by investors. But first thing is we should bear in mind that investors are very, very diverse and we may have investors with very different perspectives and terms of analysis, so some people looking at the short term, others looking at a very long term, some that are able to understand broader systemic implications of what happens with the company, others that will be just looking at what will reflect in the relatively short term in the finances and competitivity of the company. So we should be wary about what exactly we mean by investors, and this has to do with another topic, which is materiality. So the selection of information to report on and to follow on and to monitor is key in this whole process because there is too much information everywhere and the company has to select what to measure, what report, what to organize, making a narrative and making sense out of the data that has been gathered, the indicators…
So the concept of materiality and the application of the concept is another key aspect, and by that I mean that let’s say there are different approaches on materiality, although everybody agrees that the material topics are those that will make stakeholders take different decisions if omitted or obscured or by somehow not being truthful information. So these things are material and they should have to be reported. Not everything is has the same importance for different stakeholders and from different perspectives.
So when you talk about ISSB and IFRS, they are very clearly focusing one kind of stakeholder, which are the investors. And as I mentioned, we have to understand exactly what is an investor in general, but anyway, the idea of investor has to do about the financial and economic value of the company either in short term or long term. But the main idea is about value. And as Alicia was saying, there’s a big push towards waiting accounting impact, waiting accounting and measure impact. These kinds of methodologies that are very important and will be key, but we also should think about other stakeholders and what will be the material information for other stakeholders and in this sense, the frameworks and the legislation and as have been mentioned how Europe has a transition agenda and a Green New Deal that’s organizing the transformation of the of the economy is very important.
So I think that’s the second point. So we have nothing to take for granted. What is or what isn’t material when actually put in motion the plans and the organization of data and information and reporting and of course planning the business model, planning how the company will move forward.
And this brings me to the third topic I’d like to comment, which is the fact that all this is happening in front of a background which is an urgent transformation of how our society operates, its production and consumption patterns, and we all know and everybody have heard that, that if everybody in the world consumes as the rich countries today. There will not be enough resources or capacity of the planet to absorb all these impacts or to provide the ecological services, the environmental services and the natural resources for that.
So the idea that we are in the transition in a model of production and consumption, and that’s an urgent transition is something that sometimes can be, let’s say, forgot in the middle of this this whole debate. So sorting out what is relevant and what isn’t, I think it’s a very key topic and something that we should bear in mind. And developing ways to sort out what is or what isn’t that important is something that we will have to take care in the future and for me and just finishing here, the idea is that we will have to select the tools and to select the methodologies that companies will use and for that I think that we should bear in mind all the time what they call the CIDI Framework, which is about the connection of this with the SDG’s and the 2030 agenda. So how does this connected the for the see the eyes about integration, how these things are interconnected and integrated with the business model, the D is about dimension, about the scale and speed of the changes that we’re talking about because there’s an urgent transition that’s mapped on Agenda 2030. And the final one is about inclusion, inclusiveness, which means the the motive leaving the one behind is something that we should bear in mind while making this movement towards a new business model and a new ways of production and consumption that will be more sustainable. So thank you very much. Much sorry if I passed a bit of my time and Congrats again for the great work and for my colleagues, virtual colleagues in the panel. Thank you very much.