It can be tempting to hide behind “readily processed” ESG data. Yet this can be just as unhealthy as a diet of 100% readily processed food! ESG ratings have an important role to fulfil, but should not be blindly relied upon. They have widely differing methodologies. These are often updated without a transparent and broad…

Even sustainability targets with seemingly similar scopes can be quite different. Carbon, gender split, recycling rates – all of these can be measured in various ways, leading to different sustainability trajectories. Firms will often tweak calculations to suit the distinct nature of their business, sector or geographic profile. For instance with carbon reduction, some may…

This is the “million dollar” question when assessing an organisation’s ESG targets. Is it really pushing itself or opting for a low-ball estimate of what it can achieve in the coming years? For corporate executives, setting these types of goals requires striking a fine balance. On the one hand you want targets to be achievable,…

While it is tempting to split ESG into three neat buckets, the reality is more complex. Environmental, social and governance topics are often interconnected in ways that are critical to understand. For example, climate change has major societal consequences. Equally, the required carbon transition of our economy will have implications for many people. Large groups…

Major corporate events can have a meaningful impact on a firm’s sustainability profile. Acquiring another business that has poor environmental track record may be a setback for your own sustainability ambitions. Yet an M&A event may also be an ESG positive. Acquisitions can be made with the goal of accelerating a firm’s own decarbonisation trajectory…

When assessing a company’s ESG goals, don’t just focus on a lofty end-goal or aspiration. While many companies may have appealing ambitions for 2040 or beyond, not all have clear transition plans. It is hence critical to know how a company intends to reach its goals. What intermediate milestones have been set? How much progress…

Many ESG targets can best be assessed in comparison to a peer group. Assessing the ambitiousness in isolation often is very challenging. Yet how to then assemble a peer group? Typically, firms are grouped by sector. This is how much ESG rating agencies consider peer groups. Sustainability topics are typically similar for issuers operating in…

An ESG goal in isolation only tells you so much. It gives a sense of numbers and parameters, yet not a richer context. Why did a company set on a particular goal? How does it tie into its wider strategy? This type of context requires extracting qualitative information in relation to the target. It requires…