Why are some issues greyed out? Environment
- GHG Emissions
- Air Quality
- Energy Management
The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
- Water & Wastewater Management
The category addresses a company’s water use, water consumption, wastewater generation, and other impacts of operations on water resources, which may be influenced by regional differences in the availability and quality of and competition for water resources. More specifically, it addresses management strategies including, but not limited to, water efficiency, intensity, and recycling. Lastly, the category also addresses management of wastewater treatment and discharge, including groundwater and aquifer pollution.
- Waste & Hazardous Materials Management
The category addresses environmental issues associated with hazardous and non-hazardous waste generated by companies. It addresses a company’s management of solid wastes in manufacturing, agriculture, and other industrial processes. It covers treatment, handling, storage, disposal, and regulatory compliance. The category does not cover emissions to air or wastewater nor does it cover waste from end-of-life of products, which are addressed in separate categories.
- Ecological Impacts
The category addresses management of the company’s impacts on ecosystems and biodiversity through activities including, but not limited to, land use for exploration, natural resource extraction, and cultivation, as well as project development, construction, and siting. The impacts include, but are not limited to, biodiversity loss, habitat destruction, and deforestation at all stages – planning, land acquisition, permitting, development, operations, and site remediation. The category does not cover impacts of climate change on ecosystems and biodiversity.
Social Capital
- Human Rights & Community Relations
- Customer Privacy
- Data Security
- Access & Affordability
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
Human Capital
- Labor Practices
- Employee Health & Safety
- Employee Engagement, Diversity & Inclusion
Business Model & Innovation
- Product Design & Lifecycle Management
The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
- Business Model Resilience
- Supply Chain Management
- Materials Sourcing & Efficiency
The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
- Physical Impacts of Climate Change
Leadership & Governance
- Business Ethics
- Competitive Behavior
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management
- Systemic Risk Management
(Industry agnostic)
Disclosure Topics (Industry specific) for:
Solar Technology & Project Developers
Get access to the full industry standard
Energy Management
Energy Management in Manufacturing
Solar panel manufacturing typically uses electrical energy purchased from the grid. Energy can account for a considerable share of the total cost of production. In light of rising energy costs and regulatory uncertainty surrounding the future of fossil-based energy, companies that diversify their energy sources may be better able to manage the associated risks and maintain a reliable energy supply. Companies that minimize their energy use through effective energy management can reduce costs and gain a competitive advantage through operational efficiency and competitive pricing of products. This is particularly important given the intense price competition within the solar technology industry.
Water & Wastewater Management
Water Management in Manufacturing
Solar photovoltaic panel manufacturing can be water-intensive, and ultra-pure water is a critical input in some processes. The manufacturing process can also generate wastewater, which must be treated before disposal or reuse, and can therefore result in operating costs and additional capital expenditures. Furthermore, depending on their location, solar equipment manufacturing facilities may be exposed to the risk of reduced water availability (scarcity) and related cost increases or operational disruptions. The use of local water resources is a risk that can generate tension with local water users, potentially disrupting manufacturing operations and adversely impacting brand value. To mitigate water supply and treatment risks, companies can adopt various strategies such as recycling process water, improving production techniques to lower water intensity, and improving water treatment systems.
Waste & Hazardous Materials Management
Hazardous Waste Management
Solar panel manufacturing may involve the use of hazardous substances that can cause adverse health and environmental impacts if not properly managed. Common thin-film technologies can utilize materials including cadmium, gallium arsenide, and copper indium gallium (di)selenide, which require careful handling during the manufacturing process and disposal. The handling and disposal of hazardous wastes produced during manufacturing can lead to operating costs, capital expenditures, and in some instances result in regulatory costs. As such, effective management of hazardous materials, including through reduction, reuse, recycling, and safe storage and disposal, can lower operating costs and mitigate potential regulatory penalties or reputational damage.
Ecological Impacts
Ecological Impacts of Project Development
Many large, publicly listed solar technology companies are involved in project development, including the evaluation and acquisition of land rights, site permitting, and engagement with stakeholders. Successful development is contingent on securing the approval of environmental permits and the permission of local governments and communities. Siting of medium or large solar installations in ecologically sensitive areas, including endangered species habitats, can render environmental permitting more difficult and costly. Project development may also be affected by local land-use laws and community opposition to projects due to their land footprint or concerns over impacts on local water resources. These factors can slow or disrupt the development process, possibly resulting in higher costs, lost revenues, or project delays. Companies with robust strategies for environmental impact assessment and mitigation can reduce the risk of project delays, increasing the likelihood of timely project completion.
Product Design & Lifecycle Management
Management of Energy Infrastructure Integration & Related Regulations
Companies in the industry have faced challenges in establishing solar energy as a cost-competitive means of energy production and GHG reduction, and have thus encountered difficulty in capturing a greater share of global energy generation. In order to promote greater adoption of solar, the industry can benefit by preventing systemic disruptions to the existing energy infrastructure and essential energy services. Companies are innovating to overcome the technical challenges of increasing solar integration with the grid. They are also engaging with regulatory agencies and policymakers to reduce regulatory barriers to the adoption of solar energy, many of which are emerging due to the concern around increasing overall grid electricity costs and grid disruptions. Solar companies are investing in innovative technologies to reduce hardware and installation costs, and are working toward business-model innovation to reduce the cost of capital and facilitate the purchase of solar energy systems. Solar technology companies can improve their competitiveness through deploying one or more of these strategies successfully to ensure their ability to scale over the long term.
Product End-of-life Management
Solar panels may contain hazardous substances as well as reusable materials of high economic value. Given the rapid expansion of solar energy globally, increasing volumes of solar panels are expected to reach the end of their useful life in the medium term. In some regions, including parts of the EU, manufacturers are required by law to take financial responsibility for their products at the end-of-life stage, including collection and recycling. Product take-back, recycling, and disposal may result in higher upfront investments or capital expenditures for operators in the industry. However, as more modules reach the end of their life and this issue likely receives more legislative attention, companies may differentiate themselves through offering product take-back and recycling services. This could increase revenues as well as result in lower long-term costs by reusing recovered materials in manufacturing processes.
Materials Sourcing & Efficiency
Materials Sourcing
Solar technology companies typically source numerous materials including polysilicon, metals, glass, and electrical components. Companies additionally utilize certain materials that are critical to solar panel and module manufacturing. Limited global resources of these critical materials, as well as their concentration in countries that may have relatively limited governance and regulatory structures or are subject to geopolitical tensions, expose companies to the risk of supply-chain disruptions and input-price increases or volatility. Companies can mitigate associated risks by ensuring transparency in their supply chains, working actively to source materials from reliable suppliers or regions that have minimal environmental or social risks, and supporting research for alternative inputs.
Add Industry
Recommended Next Step: Get access to the full industry standard