At-a-glance:
your ESG
checklist

At-a-glance:
Your ESG checklist

This is tax’s moment: The next few years will be crucial for tax to really come to the ESG table. And it starts now.

Tax leaders have an opportunity to grasp the ESG agenda and be at the centre of their organisation’s efforts to achieve its environmental, social and governance goals. No matter what your organisation’s ESG priorities are or where they are in their journey, it’s your chance to add significant value, and strengthen your position as a strategic partner to your organisation.

To seize that opportunity, prioritising the actions laid out in this guide will help you drive real impact and value in such a broad topic in 2023. Here’s a quick, at-a-glance summary of them:

Decarbonisation

✔︎ Connect across the organisation to embed tax throughout your Net-Zero transition

✔︎ Identify tax driven funding opportunities

✔︎ Review your processes and controls to ensure they support new taxes and regulations

✔︎ Stay on top of global carbon tax policy

Supply chain sustainability

✔︎ Engage with the business to understand theorganisation’s supply chain transformation

✔︎ Review the value drivers and consider any impact on TP and IP models and indirect tax profile

✔︎ Clarify accountability for the various aspects of the transformation

✔︎ Identify tax driven funding opportunities

Tax transparency

✔︎ Align with the organisation’s wider ESG agenda

✔︎ Make a tax transparency plan

✔︎ Map your reporting and data requirements

✔︎ Undertake regular and structured horizon scanning

People

✔︎ Collaborate with HR and the wider business

✔︎ Realise the savings – and redeploy them for good to fund additional ESG ambitions

✔︎ Review your tax governance processes and controls to ensure they support both mandatory and any voluntary reporting requirements

✔︎ Look to leverage technology

Governance

✔︎ Identify the key risks facing the tax function

✔︎ Start small and build out from there

✔︎ Find existing frameworks you can work from

✔︎ Showcase the benefits of robust tax governance

What’s more, to maximise your efforts, you’ll want a continuous drive on three fronts:

Engage

Put tax at the heart of boardroom discussions. Drive the conversation on what ESG means for your tax strategy, operations, governance and reporting. Make it clear that you’re ready to lead that – and set out what you can bring to the table.

Work across the business. Forge strong working relationships with other function heads. Partner with them to make change happen, manage the tax implications, embed strong tax governance, and align transparency with the wider ESG strategy. Promote the benefits of the tax team’s involvement to the business as a whole.

^01.

Educate

Educate yourself and the organisation.

Keep informed of the key tax developments – and make the business aware of their impact on the organisation as a whole. Identify opportunities to make use of the tax incentives available to you.

Communicate your organisation’s tax story to internal stakeholders. Tax is an ESG metric – senior stakeholders will need to make sure they understand the organisation’s tax position should they be challenged by third parties.

^02.

Evaluate

Get the tax function in the best possible place to deliver. Carry out health-checks on your data and processes, and the technology that underpins them. Identify the gaps and plan your roadmap to fill them. Then calculate the budget you’ll require to achieve this.

Lobby the board for the necessary investment. Be clear about the benefits it will bring – and the risks of not properly preparing for the future of tax in the ESG era.