As the cannabis industry continues to gain momentum globally, it is crucial for companies operating in this space to prioritize sustainability and align their practices with the United Nations Sustainable Development Goals (SDGs).
As a cultivator (or a vertically integrated company with a cultivation license) one effective way to achieve this is by implementing an Environmental, Social, and Governance (ESG) strategy, with a strong foundation based on Regennabis’ adaptation of the Sustainability Accounting Standards Board’s (SASB) Standard for Cultivation.
The Regennabis-enhanced SASB Cultivation Standard provides a comprehensive framework for cannabis companies to identify and address the most material ESG issues associated with cannabis cultivation. It covers a wide range of topics, including energy and water use, waste management, product quality and safety, labor practices, community relations, and regulatory compliance.
By adopting this standard, cannabis companies can ensure ESG strategies are aligned with the unique challenges and opportunities of the cannabis industry and that their sustainability efforts are meaningful and impactful.
Implementing an ESG strategy is a crucial precursor to outlining a sustainability strategy. It enables a company to move beyond just focusing on financial performance and considers the broader impact of a company’s operations on the environment, society, and governance.
Companies that integrate ESG considerations into decision-making processes are better equipped to manage risks, seize opportunities, and build long-term value for all stakeholders, including investors, employees, customers, and communities.
In the cultivation space, the Materiality Disclosure Topics of most significance include the importance of energy and water management in cannabis cultivation, which can raise significant environmental concerns.
Energy-intensive operations such as lighting, heating, and ventilation can contribute to greenhouse gas emissions and environmental degradation. Water usage and wastewater management are also critical considerations, as cannabis cultivation requires large quantities of water, and improper water management can have detrimental effects on local water resources and ecosystems.
Labor practices are another key area of focus in the Regennabis-enhanced SASB Cultivation Standard. The cannabis industry has faced challenges related to labor rights, fair wages, and occupational health and safety.
Companies need to ensure employees are treated ethically, fairly, and with respect, and that they are provided with a safe and healthy working environment. Community relations and regulatory compliance are also important aspects of the standard, as cannabis companies need to maintain positive relationships with local communities and comply with local laws and regulations.
By adopting the Regennabis Standard, companies can proactively address these ESG issues and demonstrate their commitment to sustainability. They can establish clear goals and targets, develop strategies and action plans, as well as monitor and report progress, which is an increasing demand of government regulators.
Ultimately, aligning with the UN SDGs is a powerful way for cannabis companies to contribute to the global sustainability agenda. The SDGs are a set of 17 goals adopted by the United Nations to address some of the world’s most pressing social, economic, and environmental challenges, such as poverty, hunger, health, education, gender equality, clean water, affordable and clean energy, climate action, and responsible consumption and production.
By integrating the Regennabis Standards into their ESG strategy, cannabis companies can identify and address the material issues that are most relevant to the SDGs and align their operations with global sustainability goals.
This article first appeared in Volume 5 Issue 1 of Cannabis & Tech Today. Read the full issue here.