Why data products are critical to environmental, social, and governance (ESG)

Data products are crucial for effectively managing environmental, social, and governance (ESG) responsibilities, especially as environmental regulations become more stringent. The Greenhouse Gas Protocol defines three scopes of emissions—Scope 1 (direct emissions), Scope 2 (indirect emissions from purchased energy), and Scope 3 (other indirect emissions in the value chain)—requiring organizations to report not only their own emissions but also those of their partners and supply chains. To manage these data demands, a shift from centralized data lakes to a data mesh approach is recommended, where domain experts can identify relevant data for ESG reporting efficiently. This decentralized model, as demonstrated by platforms like Starburst, enhances the searchability, quality, and addressability of data products, enabling organizations to meet ESG requirements effectively. Integrating a data mesh strategy facilitates self-service insights and creates standardized data sets, which are essential for fast and repeatable use across teams, ultimately leading to more informed decision-making and compliance with environmental initiatives.