Sustainability and ESG in 2025: Next-Gen Metrics, Technologies, and Compliance

Sustainability in 2025 goes far beyond the CO₂ footprint. Companies must collect more comprehensive ESG data (Environmental, Social, Governance) to meet rising demands and stakeholder expectations. According to the World Economic Forum, ESG reporting is now a critical factor in investor decisions and corporate reputation. Here are the key points:

• New Metrics: Energy consumption, water usage, biodiversity, diversity, employee satisfaction, supply chain sustainability.
• Technologies: AI for data collection and analysis, blockchain for data security, IoT sensors for real-time tracking.
• Key Standards: CSRD requirements, ISO 14046 for water accounting, ESRS for sustainability reporting.
• Challenges: Unclear Scope 3 data, complex supply chains, insufficient transparency.
• Solutions: Automated data collection, standardized reports, digital tools.

Companies that implement these steps improve their ESG performance, comply with regulatory requirements, and strengthen their market position. Notably, global ESG assets are projected to surpass $53 trillion by 2025, representing more than a third of all assets under management (Bloomberg).

Next-Generation ESG Metrics

Water Consumption Metrics

Managing water resources is becoming increasingly important, especially in light of growing water scarcity. A proven approach for precise water accounting is the application of the ISO 14046 standard (Water Footprint) as an international benchmark. According to the United Nations, over two billion people live in countries experiencing high water stress, making corporate water stewardship a global priority.

Here are some key metrics:

Given the global challenges of water scarcity, it is crucial to regularly monitor water consumption. Both ecological and social aspects should be considered, as highlighted in the CDP Global Water Report, which notes that companies disclosing water-related risks are better positioned to respond to regulatory and market shifts.

Measuring Social Impact

In addition to focusing on water consumption, it is equally important to analyze a company’s social impact. This includes systematically evaluating effects on employees, customers, and the local community. The importance of social impact is underscored by recent trends showing that organizations with strong social policies experience higher employee retention and customer loyalty.

Key areas of social impact measurement include:

• Diversity and Inclusion
  Promoting diversity and equal opportunity within the company culture includes:
  • Clear and measurable diversity goals at all levels
  • Regular review of pay equity
  • Inclusive hiring processes
• Employee Wellbeing
  This covers aspects such as job satisfaction, engagement, health and safety standards, and training opportunities.
• Community Engagement
  Impact on the local community is assessed through analysis of the societal benefits of company projects, community feedback, and documentation of charitable programs.

ESG Technology in 2025

AI for ESG Data Analysis

Artificial Intelligence (AI) simplifies the collection and analysis of ESG data by processing large volumes of data from various sources, including unstructured data such as annual reports and regulatory documents. In ESG, AI is primarily used in the following areas:

AI-driven ESG analytics are increasingly being adopted by leading firms to identify risks and opportunities, as noted by McKinsey. In addition to AI, blockchain technology is used to keep data secure and transparent.

Blockchain for ESG Verification

While AI analyzes the data, blockchain ensures its security and traceability. With global ESG assets estimated to exceed €53 trillion by 2025, data verification is becoming increasingly important (Bloomberg).

"Blockchain acts as a guarantor for the accuracy and transparency of data due to its tamper-proof nature." - Danica Šebestová, Squire Patton Boggs (US) LLP

Blockchain enables, among other things, the authentication of raw data, checking consistency between source data and ESG reports, automated data collection in supply chains, and tracking materials from origin to end use. According to Deloitte, blockchain adoption in ESG reporting is expected to accelerate as companies seek greater transparency and trust.

IoT Sensors in ESG Tracking

Together with AI and blockchain, IoT sensor technology also plays a key role by providing real-time data for more precise ESG measurements. One example is the 5G Forest Guardian project in the Görlitz district, where the 5G SENS IO-BOX solution with soil sensors is used to monitor environmental data.

The advantages of modern IoT technology include weatherproof and UV-resistant housings, use of LPWA networks (e.g., LTE-M, NB-IOT), and over 5,000 measurements with minimal energy consumption. The integration of IoT in ESG is helping companies achieve more granular and actionable insights for sustainability initiatives.

"Real-time monitoring makes it possible to track emissions performance and asset condition from anywhere in the world." - Sensirion Connected Solutions

ESG Compliance Requirements

CSRD Implementation Steps

Starting in 2025, reporting obligations will change for around 49,000 companies in the EU due to the CSRD. Companies must prepare their sustainability reports according to the European Sustainability Reporting Standards (ESRS). The CSRD aims to harmonize sustainability reporting across Europe and increase transparency for investors and consumers.

Key CSRD Compliance Requirements:

• Integration of sustainability information into the management report
• External audit of reports
• Use of the European Single Electronic Format (ESEF)
• Conducting a materiality analysis

These requirements form the basis for international standards and their implementation.

International ESG Standards

Alongside local requirements, international standards emphasize the global perspective. The ESRS are based on proven international frameworks and work closely with the International Sustainability Standards Board (ISSB). The ESRS 2 standard follows a four-pillar model inspired by the Task Force on Climate-Related Financial Disclosures (TCFD). The IFRS S1 and S2 standards also reflect this global shift toward harmonized sustainability reporting.

"The ESRS go beyond the ISSB standards and require companies to report on a broader range of information to meet the EU’s ambitions in line with the EU legal framework." – EFRAG

ESG Data Verification

Technological solutions play a central role in verifying ESG data. With AI-powered tools, up to 95% accuracy can be achieved in verification (Deloitte).

Three essential steps for successful ESG data verification:

• Automated data collection: Use AI tools to extract and analyze ESG data from various document formats.
• Gap analysis: Compare existing data with ESRS requirements to identify deficiencies.
• Blockchain integration: Use blockchain technology for secure documentation and tracking of ESG data.

Modern technologies provide a solid foundation for precise ESG measurement and compliance.

Environmental, Social and Governance (ESG ...

ESG Success Stories

Successful examples show how companies implement comprehensive ESG concepts and achieve real progress. For instance, Unilever has integrated ESG metrics into its core business strategy, resulting in improved resource efficiency and stakeholder trust.

ESG Programs in Companies

The Böllhoff Group, a leading provider of fastening and assembly systems, has successfully introduced modern ESG tracking systems. With 43 locations in 25 countries, the company was able to record its Scope 1 and Scope 2 emissions within just a few weeks.

"We are thrilled with the efficient collaboration and the well-designed software solution from Tanso, which enabled us to create a transparent CO₂ accounting for Scope 1 & 2." - Maximilian Obermann, Sustainability Manager at Böllhoff

In addition to such programs, the shift to a circular economy is playing an increasingly important role.

Circular Economy in Practice

The circular economy requires new approaches to ESG data collection. Companies are focusing on:

• Digital real-time material tracking
• Product lifecycle analyses
• Monitoring resource efficiency

Such approaches are specifically supported by specialized service providers. According to the Ellen MacArthur Foundation, circular economy initiatives can reduce waste and emissions while driving innovation.

Services from Fiegenbaum Solutions

By combining technology and sustainable business models, companies can achieve their ESG goals and strengthen their market position. The combination of technical expertise and sustainability knowledge leads to measurable improvements in ESG performance.

Conclusion: Building Strong ESG Systems

Key Takeaways at a Glance

ESG tracking systems encompass far more than just the CO₂ balance. Over 4,000 companies have already set SBTi targets. Traditional methods, especially for capturing Scope 3 data, are reaching their limits. Using AI for automation ensures more efficient processes and more accurate data. As Sustainalytics notes, the integration of digital tools is now a key driver of ESG maturity.

These points lay the foundation for concrete actions, which are described in the next section.

Steps Companies Should Take Now

The following actions are based on the technologies and standards discussed above.

The market is showing strong growth in sustainable investments. Companies can benefit by implementing the following steps:

• Digital Transformation: Manage sustainability data centrally and cloud-based.
• Automation: Use AI to unify data sources.
• Ensure Compliance: Deploy automated tools to check compliance with CSRD requirements.

With these measures, companies can improve their ESG performance and meet regulatory requirements. For more on ESG best practices and evolving standards, visit the OECD ESG portal.