The ESG challenge - 10 data points for ESG reporting (2024)

Environment, social and governance (ESG) is a key business priority, involving companies assessing their performance across ESG issues and reporting on their impact in these areas. ESG reports and ratings support investors’ assessment of a company and goals to fund businesses with sustainability-led goals.

ESG reporting and other sustainability-related requirements, such as supply chain due diligence laws, are growing requirements. 99% of S&P 500 companies1 report on sustainability, while in Europe new reporting regulations will cover around 50,000 companies2.

The challenge for companies

To meet ESG requirements, companies must collect a wide range of data across various topics to report on their ESG performance. A lack of consistency in reporting standards and requirements across ESG ratings providers, frameworks, and financial services makes it incredibly challenging for businesses to understand how to do this.

Companies typically need to balance ESG reporting alongside other related priorities, such as complying with legislation, meeting consumer demands and conducting their own detailed sustainability initiatives - making ESG a complex area to respond to. There is also increasing interest in how a company addresses ESG issues in its supply chain as well as its own organisation, such as Scope 3 emissions.

The key to meeting this challenge is having high-quality data to report on and inform business decisions.

1Source: BDO USA, July 2023

2Source: European Parliament, November 2022

"I'm truly impressed by the amount of information available through Analytics. Sedex is definitely the 'El Dorado' [goldmine] of ESG data."

Bloomberg estimates that ESG investment portfolios will reach $30 trillion in assets under management globally by 2025.

What gets measured gets managed

Data on a business’s operations, employees and supply chain is crucial for identifying and tackling social and environmental sustainability issues, and evidencing a company’s ESG impact.

Capturing the right data using effective assessment tools equips a company to achieve their ESG goals and supports other sustainability activities. Having this data brings many other business benefits, including more effective risk management and accurate, data-driven decision-making.

How to prepare for ESG requirements effectively

Sedex has identified 10 core areas to collect data on that feature across many ESG frameworks. Companies can use this list to gather, track and analyse data efficiently to feed into multiple sustainability requirements.

We can support your business with gathering this data and achieving your sustainability goals. Our data-led Platform, assessment tools and professional services provide a seamless solution for holistic ESG management and reporting, saving time through reducing duplication and effort.

Sedex tools enable companies to collect, share and analyse relevant data at scale, build supply chain visibility, manage risk and measure progress to include in ESG reports – helping businesses demonstrate tangible progress with credible evidence.

Global Reporting Initiative (GRI)

An open-source framework. Companies publish ESG reports using its requirements for raters such as Bloomberg to use for scoring.

IFRS Sustainability Standards

The International Sustainability Standards Board (ISSB) aims to provide a common set of standards for corporate sustainability reporting. The ISSB is working with the GRI and CDP to align requirements across sustainability reporting frameworks.

Carbon Disclosure Project (CDP)

A membership organisation and ESG framework, focusing on environmental issues only. Companies submit reports through CDP at investors’ requests.

Sustainability Accounting Standards Board (SASB) Standards

An industry-specific, open-source framework covering 77 industries, limited to reporting only on risks that are financially material to a business.

Select a segment to learn more about the data points.

When reporting on these data points, cover a standard reporting period (the previous financial year) unless you have specific requirements to do something different.

Tip: Store operational and supply chain data on the same system for integrated analysis and reporting.