POST: It’s Annual ESG Survey & Query Time -– Public Companies Are in Response Mode…

G&A's Sustainability Highlights (04.20.2018)
Apr 25, 2018 9:00 AM ET
Newsletter

Barrage… Avalanche… Tidal Wave… Tsunami...  “Survey Fatigue...” 

These are terms we hear all year ‘round and especially in the spring of the year as corporate managers describe for us what they often feel as the inevitable growing flow of third party ESG / Sustainability data sets, ratings, rankings, surveys, forms and various types information for review come pouring into their offices.  It’s spring – survey time!   Large-cap companies may receive 200 and more such queries during a year. 

These ESG profiles are more important to address each year as more asset owners and their managers either directly pose questions to companies -- or do so through an army of third-party ESG analytics firms. Stakes are high and getting higher for executives and boards as these data sets can result in inclusion in sustainable investing indexes, benchmarks, investor products, and win high rankings, scores, ratings and other honors.

Corporate managers are aware that there is an ever-widening transparency of the company ESG profile: the Bloomberg professional services ESG dashboard will put the company’s ESG data and profile in front of more than 300,000 subscribers; the Thomson Reuters’ Eikon dashboards reach 200,000 and more subscribers with the same kinds of information.  Other important suppliers of ESG data to investors include MSCI, Sustainalytics, RobecoSAM, Oekom, ISS, and more.

We are hearing the call from the corporate offices this month -- Help!

The good news:  there are efficient, comprehensive, organized ways to meet the challenges described at publicly-traded and even privately-owned enterprises. Here at G&A Institute, we've developed what we call our ESG matrix approach to assist companies to review, engage, and enhance the “mosaic” (or multi-dimensional) corporate ESG profile -- with significant benefits for our clients.

This ESG "mosaic" profile may be incomplete, inaccurate, misleading, or otherwise detrimental to the company and its stakeholders. That leads to negative perceptions that can significantly affect corporate reputation and valuation.

We start with an examination of the most influential third party ESG investor data sets, rankings and ratings of the corporation.  Key areas of strength, weakness and the competitive standing will emerge from our comprehensive analysis. Correcting inaccurate data, and guidance for improving reporting by better organizing important ESG disclosure data is a valuable result.  Longer term, the results of this type of analysis and engagement inform strategy setting, and resource allocations to most efficiently and effectively improve the ROI of the Sustainability program.

KEEP IN MIND:  Improving the ratings, rankings, scores etc. is a journey, not a sprint.

It’s important here to stress that whether or not a company chooses to answer queries, respond to data provider inquiries or attempts to correct some public information that service providers are sharing with investors, there is a public sustainability profile out there and it is making an impression on investors. 

What Value Do Companies Get From Engaging With ESG Investor Data Providers?
G&A's Co-Founder Louis Coppola was recently interviewed at Skytop Strategies ESG4 Summit on the Value Companies Can Obtain by Engaging with ESG Investor Data Providers.  Watch the interview here and email Lou at lcoppola@ga-institute.com if you have any questions or would like to discuss.

More information on this topic can be found on our more comprehensive blog post here.

For your information:   As the flow of this year’s queries reaches corporate managers, it is important to understand who some of the key third party ESG players are -- and what their work is about – and how they can impact the corporation.

This is just the introduction of G&A's Sustainability Highlights newsletter this week. Click here to view the full issue.