Solution Brief
solution brief

Archer ESG Management Solutions
The Importance of ESG Compliance:
Ensuring Sustainability and Responsibility in Organizations
As businesses move towards attaining sustainable growth, there is an increasing demand forsocial and environmental responsibility. Meeting these standards can go a long way towards
managing risks, improving corporate reputation, and ultimately promoting long-term stability.
Environmental, Social, and Governance (ESG) compliance is key to achieving these goals. ESG
refers to the practices and standards companies must follow to ensure accountability andtransparency in their financial performance. ESG factors highlight tangible and intangible
business costs such as environmental damage, social inequality, and widespread corruption.

What is ESG Compliance?
ESG compliance guides corporations in being more sustainable, responsible, and reliable. ESG
criteria go beyond short-term financial gains and assess the long-term value of an organization.
The environmental aspects focus on an organization’s commitment to reducing its environmental
impact, such as reducing energy consumption, mitigating carbon emissions, and minimizing
waste. Social factors deal with how businesses interact with society, including corporate social
responsibility, employee welfare, and human rights. Governance focuses on how a company
is structured, how it operates, and the mechanisms put in place to ensure adequate accountability
and compliance measures are implemented.

ESG Compliance: Why It Matters
There is an increasing need for organizations globally to adjust their operations to stay in sync
with new social expectations. Environmental crises, pandemics, inequality, and corruption haveamplified the stakes in the corporate world. Failing to comply with ESG regulations could leadto significant harm to the organization and the environment. With the rise of social media,
investor activism, and watchdog groups, companies have come under greater scrutiny toadopt sustainable practices. ESG compliance enhances risk management and risk mitigation
practices and policies, leading to a more sustainable corporate landscape.

The Benefits of ESG Compliance
Companies with effective ESG programs enjoy significant benefits such as attracting talent,
becoming more competitive, gaining new investors, and staying future-proof. According toa study by the University of Oxford, 88% of companies with robust ESG practices achieved
better operational performance. In addition, the same study revealed that 80% of companies
with prudent sustainability practices positively influenced their stock price.

Building an effective ESG program is not without its challenges. The wide spectrum ofdata organizations must gather, analyze, and disclose is growing exponentially. There
are a myriad of regulations and ESG frameworks being introduced that vary by region,
country, and continent. Technology will play a big hand in helping organizations establish
effective and scalable programs that will enable businesses to become better corporate
citizens, mitigate risk, and ensure their long-term viability.

The Archer ESG Management Advantage

Archer ESG
Management provides
powerful tools
to automate thedata collection andaggregation process.

Archer ESG Management provides business leaders with integrated technology andtools to meet ESG regulatory and compliance obligations, manage ESG risks, andleverage ESG opportunities.
Archer’s ESG Management solution allows organizations to collect and centralize
ESG data, evaluate the impact of risks and opportunities on business strategy, assess
third-party ESG risks, set ESG objectives, and produce auditable sustainability reports- all from a single, integrated platform.

Take control of your ESG data
Gathering accurate, reliable ESG data is crucial to informed decision-making leadership
requires to drive business success. Companies need to ensure their data collection
processes’ accuracy, completeness, and consistency.
With Archer, your organization can quickly and efficiently gather, aggregate, and analyze
ESG data internally and across your supply chain, empowering decision-makers withactional, accurate, and timely data. Archer ESG Management provides powerful tools
to automate the data collection and aggregation process. The Archer platform enables
any 3rd party data source, database, or business system to directly input relevant
ESG data, such as carbon footprint data from your organization, vendors, and global
supply chain.

Manage Regulatory Divergence
The growing number of ESG regulations comes with challenges for multinational
corporations. Each region, country, and governing body has its own set of requirements,
which can pose issues when trying to manage ESG reporting and compliance acrossdifferent regions. Differences between ESG standards stem from everything, including
political, social, and economic factors within these countries. Although there has beensome progress in harmonizing ESG standards, many countries are yet to achieve completealignment, leading to regulatory divergence.
The Archer ESG Management solution provides access to the major ESG frameworks
in use today and continually evaluates and certifies new ESG frameworks as they go intoeffect. Archer currently supports the TCFD, GRI, and SASB frameworks. By incorporating
ESG frameworks into Archer, organizations can use the ESG framework(s) that bestaddress their needs.

Archer ESG Management Solutions | 2Emissions Tracking and Reporting
Today’s organizations face mounting pressure to track and report their environmental
impact. Consumers are increasingly eco-conscious, and regulations like the European
Union Corporate Sustainability Reporting Directive (CSRD) and California’s Climate
Corporate Data Accountability Act require reporting on the organization’s scope 1,2, and 3 emissions. However, accurately measuring your carbon footprint can be acomplex and time-consuming challenge.
Archer Carbon Management empowers organizations to overcome these challenges
with a user-friendly software solution designed to simplify and streamline sustainability
and emissions reporting. Archer Carbon Management allows organizations to evaluate
their carbon footprint and establish emission-reduction targets to improve organizational
resiliency and sustainability.

The Importance of Materiality
Materiality plays a crucial role in the disclosure of information by companies. In the U.S.,
an omitted fact is considered “material” if a reasonable shareholder would deem it
important in deciding how to vote or if its disclosure would significantly alter the total
mix of information made available. The E.U.’s CSRD, on the other hand, requires double
materiality. It entails disclosing how a company impacts the world (outside-in materiality)and how the world affects the company (inside-out materiality).
Double materiality may sound complicated, but it’s pretty simple. At its core, double
materiality means that companies can have a material impact on the environment andsociety and vice versa; environmental and social issues can have a material impact on
a company’s business operations. When companies report on their environmental andsocial impact, they must consider not only their direct impact but also their indirect impact
on society and the environment.
The Archer Double Materiality Calculator helps you quickly and easily assess, calculate,and report on double materiality impacts. Pre-configured assessments based on theE.U. ESRS framework allow for evaluating individual impact and performing financialassessments. The Archer Double Materiality Calculator provides a simple and intuitiveenvironment that enables users to quickly and efficiently input the required data by
simply responding to questions and prompts in alignment with the ESRS framework.

Empower Institutional Investors
The investment community plays a pivotal role in the environmental, social, and governance(ESG) world. As the momentum behind impact investing continues to grow, institutional
investors are increasingly motivated to assess the ESG footprint of their investment
portfolios. However, this task presents significant challenges, as portfolio managers
must execute a tedious process of collecting and reviewing an extensive volume of data
points across their investment portfolios, which can encompass anywhere from a fewdozen to thousands of investment companies. As a result, this manual approach leads
to a long and inefficient execution cycle.

Archer ESG Management Solutions | 3

To meet this challenge, Archer has developed an ESG solution tailored to meet theneeds of the private equity’s general partner (GP) - portfolio company structure. This
innovative solution can be utilized by a diverse group of institutional investors involvedin private and public, debt and equity investments. A wide range of portfolio managers,
including asset management companies, venture capital, private equity firms,and commercial lenders, can benefit immensely from implementing Archer ESG
Portfolio Management.

About Archer
Archer is a pioneer in risk
management deliveringsolutions for the heroes
tasked with helping theirorganization deal with

Archer ESG Management

uncertainty. We enable

With Archer ESG Management, you can help ensure your organization’s continued
success and longevity by addressing today’s environmental, social, and governancechallenges. Archer ESG Management centralizes ESG data and assesses performanceagainst thresholds using intuitive, graphical reporting to clarify evolving regulations,requirements, and liabilities.

a technology platform toArcher ESG Management includes a number of use cases to meet your needs:
 Archer ESG Management provides enterprise-wide assessment, mapping,monitoring, reporting, and quantification of the organization’s environmental,social, and governance programs.
 Archer ESG Disclosure Management is a comprehensive solution addressing thegrowing demand for transparency in ESG reporting, providing a complete solutionthat aligns with the TCFD framework & GRI 2 General Disclosures initiative.
 Archer Carbon Management provides a comprehensive solution for organizations
aiming to accurately measure and manage their carbon emissions amidst growing
regulatory pressure and consumer demand for sustainability.
 Archer Double Materiality Calculator helps you quickly and easily assess, calculate,and report on double materiality impacts.
 Archer ESG Portfolio Management enables institutional investors to efficiently
gather and analyze ESG data across their investment portfolios.

better decision making withmanage all types of risk.
With more than 20 yearsof experience, Archer issolely dedicated to helping
organizations manage
risk, ensure complianceand meet emergingchallenges such as ESG
and operational resilience.
Working with the largest
pure risk management
community globally withmore than 1,200 customersof all sizes and industries,
we help our customers notby building a wall aroundtheir business but bybuilding a bridge to theirnext opportunity.
Visit www.ArcherIRM.com.

Archer ESG Management provides the tools to deliver decision-useful information tobusiness leaders to view and evaluate compliance, environmental impact, and supply
chain risk with quantifiable data and metrics. This actionable data helps inform better
decision-making and achievement of corporate goals while mitigating risk and ensuring
the business takes steps to ensure its success.

@ArcherIRM

Archer Integrated Risk Management©2024 Archer Technologies LLC. All rights reserved. Archer and the Archer logo are registered trademarks or trademarks of ArcherTechnologies LLC in the United States and other countries. All other trademarks are the property of their respective owners. Archerbelieves the information in this document is accurate. The information is subject to change without notice. 4/24 Solution Brief.