With the growing investor demand for environmental, social, and governance (ESG) data, particularly in the listed equities spaced, it may become difficult as a corporate to see the wood for the trees. Which standards should you focus on in your public reporting? What definitions should you be following internally and externally? Have you done everything possible to optimize its public reporting for investor ESG evaluation purposes? If you have extra resources to respond to some investor and rating agency requests, which should you focus on and why?
Public reporting check
Most of the ESG rating agencies collect data on companies based on publicly available information and then ask the company to provide feedback. Few leading raters allow you to provide input first and then verify your input. Both increasingly focus only on public information. It is, therefore, of the utmost importance to ascertain transparency on the right topics, with the right definitions and the right wording in your public reporting and on the website.
Blue Phoenix’s public reporting check analyzes the corporate’s performance in investor ratings against the draft corporate reporting deck (Sustainability Report, Strategy Review, Annual Report, etc.) or a detailed content planning of the upcoming reports. In the check, ‘quick’ and ‘heavy’ wins are identified and shared with the company. These will include recommendations for nuances in wording that matches what the ESG raters deem acceptable, as well as concrete recommendations for reports and other public company resources. Upon request, it also includes ‘snacks’ to engage internal stakeholders and management to provide further transparency and adjust certain wording.
Checks are available for, but not limited to, SAM Rating (DJSI), MSCI ESG Rating, Sustainalytics ESG Rating, FTSE4Good.
ESG rating support
As a company, knowing that you have industry best practice sustainability programs in place, yet failing to see this reflected in investor ESG ratings, can be very frustrating. So can be a lack of resources to respond to rating agencies aren’t always available, and sometimes it is an art to understand exactly what the agency is looking for.
Through several service levels, Blue Phoenix can lift some of the reporting burden.
Ratings that require active participation
- Guide relevant subject matter experts through the process. Blue Phoenix translates the often ‘one-size-fits-all’ methodology to your business model. As a result, few to no assessment areas remain unanswered (depending on the maturity of your programs), chances of improving in the chosen ESG rating are increased, and the results will be reflecting the actual state of your company’s ESG performance.
- Help you with business cases to internal stakeholders and management for answers you were previously not allowed to share with the rater.
- Review your answers before submission and identify gaps.
Support is available for, but not limited to, SAM Rating (DJSI)
Ratings that require feedback
- Guide relevant subject matter experts through the process. Blue Phoenix translates the often ‘one-size-fits-all’ methodology to your business model. As a result, few to no assessment areas remain unanswered (depending on the maturity of your programs), chances of improving in the chosen ESG rating are increased, and the results will be reflecting the actual state of your company’s ESG performance.
- Review your answers before submission and identify gaps.
Support is available for, but not limited to, MSCI ESG Rating, Sustainalytics ESG Rating, FTSE4Good