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Using Earth Observation To Measure ESG Impact

Earth Observation data enables better measurement and compliance for companies pursuing their sustainability agenda

The Indian space sector is projected to hit $50 billion in revenue by 2024. It was only 47 years ago India launched Aryabhata, its first ever satellite, paving the way for a new era. In 1988, the IRS-1A, India’s first indigenous remote sensing satellite laid the foundation for advancing the use of remote sensing data.

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Today, the application of what is now called Earth Observation (EO) spans well beyond the scientific community. In fact, it has become one of the most widespread disciplines used in connection with Environmental, Social and Governance (ESG) measurement and reporting criteria.

Under growing pressure from governments to comply with national and global standards on sustainability goals, companies are resorting to innovative solutions to gauge their operations' socio-economic and environmental impact. Key players in the Indian economy, in particular, are aiming to lower their carbon footprint to meet net-zero targets, and some organizations are already betting on EO data to track natural disasters across three million sites and commercial assets worldwide.  

The rise of geospatial technology – a field encompassing geography, mapping and analysis – and geospatial marketplaces with better access to data has also made integrating EO for ESG measuring and reporting easier for businesses outside the geospatial industry from finance and insurance to banking. 

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In the spirit of cooperation and expansion, governments like India’s are opening their doors to space companies and commercial entities to unlock the benefit of EO in areas that haven’t been traditionally associated with space – a trend known globally as New Space.  

However, before starting to implement EO as part of a company’s ESG measurement approach, it is important to understand the added value EO data brings in addition or as an alternative to other existing data points. 

Use cases alone aren’t enough to comprehend the value of EO for ESG assessment. It’s crucial that we understand why EO data is best positioned to help companies measure their impact. 

Monitoring crop health is key to food security; weather data is essential to disaster prediction; inspecting mining sites is critical for risk assessment; tracking vegetation growth alongside infrastructure is vital for safety; change and object detection finds application in the most disparate cases from asset management to illegal logging or fishing.  

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The examples are countless, but they all rely on three fundamental advantages: 

Accuracy: EO imagery and derived geospatial data are highly accurate and constantly updated in real time. This helps inform on nuances that owing to artificial intelligence and machine learning would otherwise be impossible to capture from the ground.

Transparency: By virtue of being easily accessible as open data, and now even more so through popular marketplaces that aggregate commercial data sets, EO enables companies to generate transparent, hence compliant records.  

Integration: EO data is complementary and compatible with other types of data. This is key to ensuring that stakeholders are better informed before making decisions about critical situations such as natural disasters, which require the right balance between localized and at-scale insights.  

These advantages facilitate the integration of EO in ESG data. However, one of the reasons EO has became a palatable solution is also due to some intrinsic limitations within the ESG assessment criteria. 

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From an environmental standpoint, companies implement policies that may involve energy use, greenhouse emissions, natural conservation and similar aspects. Social impact is determined by the effect on society at large. Governance refers to the ethical standards held at a leadership level.

According to experts, capturing a company’s ESG impact is not an easy task. Some argue that a localized approach to ESG could fill in the gap between India and the Western world. The reason behind this can be pinned on a common pitfall: companies tend to focus on measures instead of evaluating processes.  

In the most simplistic notion, measuring a company’s impact requires a deeper comprehension of complexities beyond numbers and statistics. It takes a holistic approach to capture change as it happens. 

For one, EO offers a bird’s-eye view of specific geographic areas or assets, sometimes even in real time, which serves as a starting point for a more in-depth analysis supported by both qualitative and quantitative information.

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Being able to track changes throughout time at a local level and place them in the context of a greater ecosystem enables companies to narrow down their approach to problems. For example, identifying the root cause of a disturbance in the field through satellites is a more sensible approach than generally trying to solve the problem with pesticides. 

If considering ESG measurement in terms of an ecosystem is the answer, then integration of EO is pivotal in generating comprehensive and trustworthy reports. 

ESG measurement and reporting do not have a one-size-fits-all solution. The clear advantage of bringing EO into the conversation around sustainability reports is their compatibility with different blocks of information. 

By combining high-resolution and lower-resolution datasets with diverse insights, EO imagery allows for real-time insights at scale, helping companies focus on changes in connection with myriad other factors beyond their direct control. In this use case, the Taman National Park, near Palangka Raya, in Indonesia, was analyzed by combining EO data with geo-referenced public administration information to inform land-use policies. These include photographs, OpenStreet maps, protected areas, cropland, built-up area change and forest cover. 

This is the power of big data, but also its limitation. In a world where everything is measurable and billions of datasets are generated every second, accessibility has never been more critical.  

On the one hand, more geospatial platforms are entering the market, all aiming to make commercial EO data easily accessible. Blue Sky Analytics is perhaps one of the most iconic India-born solutions to offer environmental data for monitoring the impact or risk to the economy. 

On the other hand, existing Indian startups are being granted access to governmental data from the Indian Space Research Organization (ISRO) for a variety of purposeful applications  like agriculture and air quality monitoring. 

And  organizations outside the space sector, like the German development bank Kreditanstalt für Wiederaufbau (KfW) are building in-house geodata solutions for planning, monitoring and evaluation of their projects in the Global South, whereas in the past there was no such methodology. 

Whatever the process, at the core of all these examples is the goal of lowering the commercial and technical barriers to accessing geospatial data and analytics. This clearly signals the need for an industry shift, where any business, in any part of the world, should be able to benefit from the power of earth observation. Just like we envisioned it 47 years ago. 
 

Ganesh Venkatesh is head of marketing at UP42, an open platform and marketplace for Earth data & analytics. 

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