Making ESG Reporting Work for Companies

By Dan Esty and Tyler Yeargain; Corporate Eco Forum; December 6, 2020

More and more investors want better alignment between their values and their portfolios – thus driving expanded interest in corporate sustainability performance as gauged by Environmental/Social/Governance (ESG) metrics. But the existing ESG data frameworks – largely provided by private rating firms such as MSCI, Sustainalytics, Bloomberg, ISS/Oekom, Refinitiv, and others – suffer from a number of structural problems (outlined in more detail below), fail to provide a reliable basis for cross-company comparisons, and therefore don't inspire investor confidence.