Organizations seeking to become more sustainable and resilient are increasingly relying on novel datasets to complement their decision-making processes. The traditional operational and financial metrics most businesses use are no longer fully effective in predicting risk and planning for sustainability. The climate crisis and the social challenges it creates are a real threat to our planet, and we need to be using all the tools at our disposal to mitigate its impacts. Emerging datasets and the technologies that allow their acquisition, storage and analyses, such as those derived from the intersection of scientific methods, can help us do just that. In this blog post, we will discuss the benefits of using novel datasets for business sustainability and resilience. If you aren't already using novel forms of scientific insights in your business, then this is the place to start!

What Are Novel Datasets?

Novel datasets are, quite simply, emerging forms of data. They are different from traditional streams of information in both their content and how they are used. Novel datasets often contain non-directly quantifiable information and come in metric units different from those that organizations have traditionally use to inform operational decision making or to present their business results to financial stakeholders. This can make them difficult to blend in for businesses at first if they have not developed an effective storytelling to link their impact to day-to-day business operations. However, the benefits of using new insights far outweigh the challenges. To give a few examples, let’s think of the additional color into business resilience and operational exposures that earth observation and satellite images provide, or the mapping of mobile communications to gauge access to services; digital biomarkers on health and well-being; social networks (from sentiment trends affecting consumer’s behaviors and patterns affecting democratic values), and civil society inputs provided by the expanded use of open data on policy making, education and voting patterns or trust in law enforcement actions.

So far, most datasets built on Environmental, Social and Governance dimensions have only been introducing new sustainability parameters. These parameters are non-directly quantifiable and come in metric units different from those that organizations have traditionally used. However, those based on scientific methods usually offer well developed insights as a result of the systematic application of the reference methodologies as well as tangible evidence of the solutions needed to combat a climate crisis. Novel Datasets can help businesses bridge the gap between traditional datasets and new sustainability parameters. Let's talk about a few of the reasons why you should be exploring their use. 

Why Use Novel Datasets? 

There are many benefits to using non-traditional datasets for business sustainability and resilience. First, they can help you better understand and predict risk. Second, they can help you plan for sustainability initiatives by providing information on how to reduce the socio-economic and environmental impact of your organization. Third, they can help you track your progress towards sustainable development goals – whether you have selected specific ones or you are looking to select them. Finally, they can provide valuable insights into the operational aspects of your business from the lens of an important “outsider” - the environment. 

From a broader scope, novel datasets can also help us to understand the effectiveness of different Environmental, Social and Governance strategies across industries and geographies. If you are looking to become more sustainable and resilient, while also supporting the network of partners committed to the same goals – within an outside an organization’s procurement cycle, then using an “outsider-in” view  is the way to go. 

How to Start Employing Novel Datasets

As businesses start stressing their own assumptions and traditional metrics with an outsider-in view, there are a few things to prioritize. First, the identification of which datasets are likely to be most relevant to a business and its industry. Second, the development  of a plan for how, when and where to collect and reflect on these novel insights. Finally, the continued assessment of the resources in place – people and systems - to support and grow this new data collection effort. 

If you are not sure where to start, there are a few good useful platforms to leverage. Global reporting hubs such as the newly formed International Sustainability Standards Board (IFRS) offer a range of indicators that can be used for environmental, social, and governance reporting and inform the processes that lead to public reporting transparency.

No matter which data you choose to collect, the important thing is getting started by having your internal audience in mind. The sooner an organization develops a fluent internal narrative, the sooner it is able to develop credible milestones, timelines and communicate specific progress as a learning and resilient enterprise externally.

Here are a few tips to help you get started: 

  • Use data visualization tools to help you unveil meaningful patterns and calibrate the outsider-in view. 
  • Work with data scientists or other experts to help you interpret the information.
  • Build models and test them against traditional datasets to see how they perform. 
  • Iterate and improve upon your models as you gain more experience with the interplay between business cycle and socio-economic and environmental impacts. 

How to Drive Learning Through Open Data

As we mentioned before, Novel Datasets can help businesses bridge the gap between traditional business metrics and new sustainability parameters. But they can also help us to understand the effectiveness of different Environmental, Social and Governance strategies across industries and geographies. If not enough businesses are collecting their own data and opening it up for peer sharing and learning, we won't be able to evaluate this information adequately. 

If you are ready to share your experience with adding new sources of insights or building sustainable and resilient businesses under the Environmental, Social and Governance mandate, then the comments section below is the perfect place to ask away. 

For more information about how to leverage novel datasets to gain business resilience and accelerate corporate sustainability initiatives, you can find The Impact Challenge online, here. All author royalties benefit the Global Association for Research Methods and Data Science.

About the Author

ALESSIA FALSARONE, SASB FSA, is a sustainable finance expert and a fellow of the Aspen Institute Business and Society Program. Her work bridges the gap between sustainability, financial innovation and risk management. A sought-after commentator for media outlets and contributor to academic programs, Ms. Falsarone is a member of high-level advisory groups that promote environmental and climate finance, including the G20 Environmental Ministerial, the London Stock Exchange, the Sustainability Accounting Standards Board (Value Reporting Foundation) and the UN Principles for Responsible Investment. In recognition of her innovative vision for business and society, she has received an Honoree Award from the Women’s Venture Fund and the 2021 Global Leadership Award by the SheInspires Foundation in the UK.

She is an alumna of Stanford University, the MIT Sloan School of Business and Bocconi University. Ms. Falsarone holds certified director status with the National Association of Corporate Directors. An avid advocate of sustainability in business education, she has contributed to educational initiatives on the topic at the Asian University for Women, the Society of Corporate Compliance, the Swiss Sustainable Finance Initiative, the United Nations, the World Bank, Stanford University and University of Chicago, including delivering training on climate risk and green finance in Asia Pacific and Latin America.

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