ESG data & reporting: how SMEs use numbers to cut costs, secure financing and avoid greenwashing

Professionalise your data architecture: financial, operational and sustainability data belong in one integrated management system

Driving without data is like driving at night without a dashboard: you may feel like you’re moving forward – but you don’t know how fast you’re going, whether you have enough fuel, or even if you’re on the right road.

That’s exactly how many companies experience sustainability: there’s a lot happening – measures, projects, first GHG balances, supply chain questionnaires – but the dashboard is missing.

The basic principle is simple: you can only manage what you measure – and you can only credibly demonstrate what you manage.

Without consistent ESG data, progress remains invisible, discussions with banks and customers stay vague, and every new request feels like a new mini-project.

At the same time, the demand for data from outside is growing:

• Supply chain (CSRD, CSDDD, German Supply Chain Act & more)

• Rating requests (e.g. EcoVadis)

• Management systems (EMAS, ISO 14001/50001)

• Banks and funding bodies

• Voluntary reports such as the VSME standard

Nearly everywhere, the same basic data is requested: energy, CO₂, waste, water, selected social indicators, supplier information.
The difference is usually just the format – not the content.

Many companies still respond to these requirements with individual Excel files, isolated solutions or email-based coordination.

The result: high effort, inconsistent numbers, little added value.

The real lever is not to collect “even more data”, but to structure and consolidate existing ESG data properly – and then use it for multiple purposes:

• One central data set, many evaluations: for meetings with your bank, supply chain questionnaires, EcoVadis, EMAS/ISO and the VSME report.

• One set of indicators that management and department heads agree on – instead of estimating everything from scratch each time.

• One data logic that connects to financial and operational figures instead of running beside them.

This is a decisive point, especially for SMEs:
Those who have their ESG data under control reduce effort, improve financing conditions, strengthen their position in tenders – and protect themselves from accusations of greenwashing (see EmpCo).

A pragmatic starting point for SMEs

On the basis of this core, ESG controlling becomes manageable – without turning it into a major project.

One possible starting approach:

1. Define core indicators
   Define central KPIs for climate/environment, resources, employees, governance and supply chain – aligned with typical requirements (banks, supply chain, VSME), but deliberately lean.
   → Benefit: clarity about what really matters in the company.
2. Clarify responsibilities
   Define who provides which figures (technical services/facility management, production, HR, procurement, controlling) – plus a coordinating ESG/data owner.
   → Benefit: fewer ad-hoc requests, less “data chasing”, more reliability.
   
3. Build a “single point of truth”
   Set up a central ESG database (initially often a well-designed spreadsheet or a simple tool), from which, among other things, the GHG balance, circularity indicators and S and G data are derived.
   → Benefit: collect data properly once, use it multiple times – for banks, customers, EcoVadis, EMAS/ISO, VSME.
   
4. Integrate into ERP and controlling

• Link energy and GHG data to cost centres/cost units

• Connect material, waste and returns data with unit costs and margins

• Store supplier ESG scores in procurement/ERP

• Use ESG indicators regularly in management reporting
  → Benefit: sustainability is managed in the same way as costs, revenue and cash.

5. Use data actively – not just for reporting
   Incorporate ESG and GHG data into investment decisions, supplier selection, risk analysis and tender processes:
   → Benefit: 

• better financing conditions and ratings

• stronger position in value chains

• visibly lower costs (energy, materials, disposal)

• lower greenwashing risk thanks to verifiable statements

Step by step, ESG data management – including GHG balance, climate risks, circularity indicators as well as social and governance data – becomes a management instrument on a par with financial controlling.

And this is exactly where the added value for SMEs arises: less effort, more transparency – and measurable economic benefits in terms of costs, financing, market opportunities and reputation.

Which data really matters for SMEs?

To get started, you don’t need a complex system, but a clearly defined core – ideally aligned with the VSME standard:

Climate & environment

• Energy consumption (electricity, heat, fuels)

• GHG balance (at least Scope 1 + 2, relevant parts of Scope 3)

• Waste volumes including recycling/reuse

• Water withdrawal (especially in water-intensive industries / regions with water stress)

Resources & circular economy

• Material input (e.g. per product/site)

• Scrap, offcuts and returns

• Waste for reuse, recycling or disposal

Employees & social data

• Number and structure of employees (contracts, full-time/part-time, gender)

• Staff turnover, sick leave, workplace accidents

• Apprenticeship ratio, training hours per employee

• Remuneration (compliance with minimum wage/collective agreements)

• Gender pay gap (where reasonably measurable)

Governance & supply chain

• Incidents/fines related to corruption/bribery

• Revenue in sensitive sectors (e.g. fossil fuels, tobacco, controversial weapons, pesticides)

• Gender ratio in the management body

• Basic policies (anti-corruption, whistleblowing, human rights)

• Simple ESG assessment of key suppliers (location, industry, volume, certificates, basic ESG standards)

• Initial assessment of climate risks (physical & transition risks) for sites and business model

This is the data foundation on which almost all external requests are built – regardless of whether they come from banks, major customers, rating agencies or a voluntary VSME report.

From ESG data to real euro effects: the example of circular economy

The “circular economy” example shows clearly that sustainability data has always been – and will remain – part of our performance data:

From ESG data to hard euro effects: circular economy in practice

The benefits become particularly visible when circularity data is connected to financial data:

• Material input per product × purchase price

• Scrap, offcuts and returns × disposal/destruction costs

• Reused or refurbished products × achievable sales price

If this information is properly stored in the ERP and controlling systems, SMEs can see, for example:

• How much do our unit costs decrease if we reduce scrap by 10%?

• How much disposal cost do we save through reuse/recycling?

• What contribution margin do refurbishment or take-back programmes generate?

Circular economy thus shifts from being a “sustainability topic” to a clearly measurable question of results and margins.

Further reading

Foundational article: ESG as a success factor

Circularity – the 3rd ESG lever for medium-sized companies:
Links to this and all other levers can be found in Kim Mühl’s article “ESG as a success factor”.

Margit Holzhammer

Country Managerin Austria West

Lawyer, long-time director of a hospital, CSR lecturer at various universities, and CSR and sustainability consultant at Terra Institute. Her focus industries are healthcare, banking, and tourism. Margit heads the Terra office in Innsbruck.​

Questions? Feel free to get in touch by email (m.holzhammer@terra-institute.eu)