ESG has become an essential component of the governance of any business. 

Fiduciary managers use ESG data to manage investment in over 80% of their investment decisions managing investments and government places a minimum weighting of 10% on ESG objectives in procurement.

Under these frameworks, a company actively discloses its sustainability-related policies, practices, performance data, and information related to ESG criteria.

The CDP asks for voluntary disclosures of non-financial data which includes greenhouse gas emissions (GHGs) and company environmental performance. The CDP framework focuses on water security, forest health and preservation, and an organization’s carbon footprint. Industry peers are used as a benchmark, as companies are scored and ranked publicly. This information is available to the public.

The GRESB is a framework that’s used for buildings. GRESB asks for voluntary disclosures for building-related ESG data, assets, and real-estate portfolios. Results are publicly available.

The DJSI is another building-specific framework that provides a subscription-based survey of building-related ESG data, assets, and real estate portfolios. Again, results are publicly available.

Guidance frameworks provide recommended methodologies and guidance to help companies identify, manage and report on their ESG performance.

The SASB provides voluntary frameworks that focus on financial substantive information that’s relevant to investors. The aim of the SASB is to provide information to the SEC, which investors can then use to compare business performance on critical ESG issues.

The GRI voluntary disclosures are broad in their aim. These disclosures address a range of ESG topics that are deemed relevant to the organization and all related management approach components. Reporting principles cover the inclusiveness of stakeholders, sustainability, and integrity. GRI standards are divided into universal, sector, and topic-specific standards that can be applied to companies depending on their industry and impact.

TCFD provides voluntary disclosures focused on target-related risks to financial systems. TCFD recommendations are based on four thematic areas, which represent the core operating areas of a business: Governance, strategy, risk management, and metrics and targets. The impact climate change has on a business, plus the impact the business has on the climate, are both considered by TCFD.

This is an initiative of the CDP developed to create a holistic view of a company’s performance. The CDSB framework aims to standardize the reporting of environmental information.

The IIRC has been developed to accelerate the adoption of integrated reporting. To this end, the IIRC merged with SASB in 2021, producing the Value Reporting Foundation (VRF). The aim is to create a baseline for corporate sustainability disclosure that can be used around the world.

Third-party aggregators refer to frameworks that assess an organization’s performance based on aggregated, and publicly available data. Data is collected from company-sourced filings, publications, company websites, annual reports, and/or sustainability or CSR reports. 

Public information displayed in annual and sustainability reports, CSR reports, and websites are aggregated and assessed. Data can only be accessed by those with a subscription.

Sustainability and CSR reports, integrated reports, publicly available company policies, and information are aggregated and assessed. The results from these assessments are publicly available.

MSCI aggregates data from 100+ specialized datasets from governments, NGOs, and models, plus company disclosures which include: Sustainability reports; proxy reports; 10-K reports (which provide a full description of a company’s annual financial activity), and 1,600 media sources. The aim of MSCI is to show a company’s exposure to ESG risks and how it compares to industry competitors. Subscriptions are needed for this data to be accessed.

Sustainalytics aggregates and assesses company data based on public company-sourced findings and media reports.

As you can see ESG is complex and New Media can help you develop an ESG strategy that will support your business transformation, and identify opportunities to help your business thrive.