With the next 12 months looming, over 25% of businesses in Asia/Pacific are bracing for their top challenge-meeting Environmental, Social and Governance (ESG) compliance requirements. This urgent need for action is underscored by a recent IDC report.
"Economic vulnerabilities combined with the steadily increasing impact of climate change in the region will result in sustainability regulations in the Asia/Pacific region to lean towards being stricter to ensure economic growth and give businesses a competitive edge in the global economy," says Abhishek Kumar, associate research director, IDC Asia/Pacific.
As a response to these challenges, a number of innovative AI-powered solutions are being developed by Asia-based technology providers. Companies such as Impact Intelligence and Alibaba Cloud in China, and ESGpedia and Unravel Carbon in Singapore, are at the forefront of this movement, as highlighted by Kumar.
AI and ESG compliance
The IDC report, Leveraging AI to Overcome ESG Compliance Challenges, shines a light on the promising future where AI-driven solutions are becoming key tools in the sustainability ecosystem. Financial institutions are already reaping the benefits of such solutions to make sustainable financing decisions.
With the increasing concerns over global and regional environmental, social, and governance (ESG) issues, the need for more aggressive regulations in the region is inevitable.
"The reality is that sustainability is here to stay. For businesses in the region, the ability to effectively manage these requirements goes beyond simple compliance management to impacting financing capabilities and, ultimately, their ability to service their clients. This is why it makes sense to work with technology providers today to develop a robust digital and AI-supported ESG compliance system as soon as possible," said Kumar.
