Bridging Cultures - from Czech to Norway: Exchange of Experience in ESG Strategy for SMEs
In an era where Environmental, Social, and Governance (ESG) considerations are becoming integral to business operations, small and medium-sized enterprises (SMEs) face unique challenges and opportunities. It is particularly evident in the ambitious collaboration between Prios Kompetanse AS and PRINCEPS Risk Intelligence Institute from the Czech Republic. The collaboration is a prime example of how international partnerships can foster significant advancements in ESG strategies.
The Importance of International Experience Exchange
The project "Designing a Risk Intelligence Methodology for ESG Evaluation," funded by EEA Norway Grants, exemplifies the critical importance of international collaboration in developing new approaches to sustainable business practices. This innovative partnership between Prios Kompetanse AS and PRINCEPS Risk Intelligence Institute aims to create a comprehensive methodology explicitly tailored to the needs of SMEs. This methodology will facilitate adherence to evolving ESG regulations and provide SMEs with actionable guidance on effectively applying these strategies within their unique business contexts. By combining distinct perspectives, resources, and expertise, we are working to establish a framework that enhances ESG evaluations and transforms compliance into a competitive advantage. This cross-border cooperative effort is a model for how international exchange can catalyze the development of effective, scalable solutions that empower businesses to navigate the complexities of ESG implementation more strategically.
Project Overview and ESG Challenges
Czech Republic: In the Czech Republic, SMEs are adjusting to the demands of digitalization, requiring diversification in financing, a more robust international presence, and enhanced digital capabilities. The transition to a low-carbon economy also presents significant challenges, including financial constraints, lack of expertise, and the absence of established data metrics, complicating the path toward robust ESG integration.
Norway: Meanwhile, Norway is poised to implement the Corporate Sustainability Reporting Directive (CSRD) and European Sustainability Reporting Standards (ESRS), which will significantly affect SMEs. This regulatory shift demands detailed disclosures on ESG targets, policies, and metrics, presenting challenges such as data quality issues, uncertainties regarding the benefits, and concerns about the costs outweighing the gains.
Despite these challenges, both countries see the evolving ESG regulatory framework as a catalyst for positive change, prompting SMEs to establish structured ESG reporting strategies to serve as competitive advantages.
The Project's Highlights
The collaboration started with a visit by PRINCEPS representatives to Norway, hosted by Prios, designed to facilitate an active exchange of knowledge and practices related to ESG strategy implementation within different business contexts. During this trip, they visited Trønderlag County Authority, Berg Accounting and conducted industry consultations with BDO Steinkjer and Sparebank 1 SMN, respectively. It was a valuable opportunity to gain clarity on compliance and best practices. PRINCEPS also had in-depth discussions with PRII and Prios about ESG strategies and their practices in different industries. The aim was to delve deeper into the nuances of ESG implementation. Through insights into Norway's proactive ESG integration, particularly in anticipation of the new European Sustainability Reporting Standards (ESRS), we aimed to provide PRINCEPS with valuable perspectives on managing ESG risks and opportunities.
Deep Dive into Mutual Learning and Benefits
During the visit, PRINCEPS explored various ESG-focused operational strategies employed by Norwegian SMEs, gaining insights into practical implementation challenges and solutions. For Prios, the interaction was equally enlightening; the visit provided an opportunity to understand more about PRINCEPS's risk intelligence techniques, enhancing our ESG evaluation methodologies. This exchange has been instrumental in refining our approach, ensuring that we meet and exceed the evolving regulatory requirements and stakeholder expectations.
This project has underscored the mutual benefits of learning, adapting, and refining ESG practices through international cooperation. Prios has particularly benefited from adopting some of PRINCEPS's analytical approaches and integrating them into our broader ESG strategy. This collaborative learning helps both organizations stay ahead of the curve in a rapidly evolving regulatory environment, ensuring that our ESG practices are both effective and innovative.
The Ongoing Role of International Cooperation
The successful outcomes from this initial engagement have paved the way for further collaborative efforts. Prios has scheduled to visit the Czech Republic, aiming to deepen our understanding of PRINCEPS's work and continue our fruitful exchange of ideas. These ongoing interactions are not merely transactional but building blocks for a lasting partnership that values cultural exchange and mutual growth.
The collaboration between Prios and PRINCEPS illustrates how joint efforts can substantially improve corporate social responsibility and ESG strategy implementation. As global markets continue to evolve, the importance of such partnerships remains clear—they are essential for developing effective and sustainable business practices that can adapt to new challenges and regulations.
At Prios, we are excited about the future of this partnership and our ongoing role in shaping sustainable business practices. Through continued cooperation and exchange, SMEs in Norway and the Czech Republic can achieve greater sustainability and resilience, setting a standard for others to follow in the global marketplace.
Sources:
https://www.czechia.eu/wp-content/uploads/2021/12/Strategy-to-support-SMEs-in-the-Czech-Republic-2021-2027.pdf
https://fintech.global/2024/01/03/navigating-esg-reporting-for-smes-strategies-and-challenges/
https://media-publications.bcg.com/How-should-companies-prepare-for-Norways-adoption-of-CSRD-ESRS.pdf
