The Longevity Key for Business

⏰ If you continue with business as usual…how long will your organisation still be viable for? 10 years? Less than 10 years? 

It’s a question that keeps many leaders up at night, as business as usual is going to be impacted by transition risks and how investors view the sustainability of your business. 

We just got back from the kick off of our upcoming report with PWC and Oxford University in the Nordics across Denmark, Finland and Norway, and upcoming in Sweden soon. What struck me about Nordic trailblazers in these markets is how they use ESG as a strategic asset to boost resilience to systemic risks AND unlock AI-driven green value creation to future proof their business models. 

🤔 The problem? Data accuracy and transparency is a huge barrier to trust. Roughly 90% of investors don’t trust the data that is being shared by companies, often still collected on manual spreadsheets. Here’s the Top 3 learnings from our discussions with top leaders on what to do about it: 

(1) At the Company Level: 

Setting the bar high pays: Overcommitting on disclosures gives regulators and investors the confidence in transparency and creates a competitive advantage, in tenders for example. Leaders are already leveraging AI in such disclosures and double materiality assessments to engage stakeholders more effectively and inform decision-making, but at a fraction of the cost. Pioneers such as Norway’s DNB have built an ESG data hub calculating financed emissions across the entire portfolio for stress testing, generating credit signals and assessing risk when making decisions on loans and other capital allocation. 

Corporate level data for investors is however only one part of the reporting equation. Building product level data capabilities for your value chain to offer genuine transparency on product lifecycles is key to translate data gathering into market value. Trailblazers such as Finland’s Stora Enso are already collecting and aggregating biodiversity data as granular as at the species level to measure ecosystem health.  

(2) At the Ecosystem Level:  

Thinking about data-sharing across value chains is not about sharing everything with everyone. Concerns over data security and losing competitive edge have often prevented moving data-sharing from asset to ecosystem level. It doesn’t have to be that way! We need to make a distinction between data sharing for the common good versus data sharing for regulatory due diligence. The latter is where trust will be built as companies prioritise compliance demands. 

Where to begin? Start small: Pick a use case such as energy data that enjoys a common regulatory urgency and build a common governance framework. Here too AI can enable data-sharing without compromising privacy and security: Data trustees such as Eurodat leverage AI algorithms to evaluate sensitive data stored in „data containers“ that then share back learnings to each entity in the data ecosystem without the need to share individual data inputs. 

(3) At the Cross-sectoral Level: 

AI can also serve as an enabler for better foundational data, i.e. data that cuts across regulations and sectors such as energy, location or demographics. Using the latest findings on palm oil production, Oxfords Prof Michael Obersteiner showed how AI-powered earth radar observations can be used to develop a digital twin of production sites and yields to determine profit-loss distributions at the asset level. This enables financial institutions to run more robust financial stress testing, allocate capital and set interest rates - which in turn affects the cost of capital for companies! 

To unlock such ripple effects with your ESG data, starting with the basics is key: There is no AI without data. And there’s no data modernization without the Cloud. The Cloud is what enables economies of scale. 

How are you thinking about leveraging your ESG as a strategic asset for managing risk and unlocking business opportunities? 

A big thank you to Andreas Feiner , Jussi Nokkala Liv Annike Kverneland Magnus Sjöström from PwC , @Michael Obersteiner Professor Mette Morsing from Oxford, and trailblazers such as Jenni Kuusivuori Toby Croucher Jani Kaskinen from Stora Enso , Aiko Yamashita, PhD. from DNB , Anniina Virta-Toikka from Konecranes , Laurence Janssens from HUB Ocean , Johanna Olesen from SimCorp and many others. Special thanks to our stellar local teams in Finland and Norway our country CEOs Mervi Airaksinen Kristine Dahl Steidel , our Norway CFO Thomas Askeland and our talented Sustainability Leads Erik JM Asbjørnsen Juho Friberg Tiia Kuokkanen Tiina Penttinen Tina Rellsve Ole Henrik Ree Piia Soramies Celine Jordan Søreide Sophia Wikander Caroline Atelius Torsten Steingrimsson Yalle Elehu Thomas Floberg Sofia V.

Mauro Xavier Anne Sheehan João Couto Ralph Haupter Darren Hardman Fiona Carney Joacim Damgard Hayete Gallot Shelly Blackburn Michelle Lancaster Carla González Fernández Maria Lehnard