Strategic Focus: Transitioning To Investor-Grade ESG Data And Decision-Making

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Executive Summary

Corporates can count on 2022 and 2023 to bring higher expectations from customers, investors and regulators for more accurate, auditable and timely ESG and sustainability disclosures. To respond to demands from internal and external stakeholders, firms will need to invest in approaches that improve the processes of gathering ESG and sustainability data and sharing the data externally at scale and with accelerated timeframes. This report identifies the design principles and approaches firms can incorporate into their requests for proposals (RFPs) to support the necessary transition from traditional sustainability data to investor-grade ESG data. The result should yield a level of data quality to support not only reporting and disclosures, but also benchmarking and ESG-related decision-making. Verdantix defines the digital strategy necessary for enabling investor-grade ESG data as an ‘ESG information architecture’.

Table of contents

Firms Are Facing A Major ESG Data Challenge 
ESG Data Requirements Are Only Growing More Complex 

ESG Information Architecture Provides A Roadmap For Achieving ESG Investor-Grade Data 
ESG Information Architecture Design Principles Focus On Reporting And Decision-Making 
ESG Information Architecture Building Blocks Enable Flexibility For The Future 
Firms Have Multiple Options For Achieving An ESG Information Architecture 

Table of figures

Figure 1. ESG And Sustainability Data Barrier  
Figure 2. Defining Investor-Grade Data  
Figure 3. Stakeholder Decisions And Timeframes  
Figure 4. ESG Information Architecture Components: Best Practices 

About the authors

Kim Knickle

Research Director, ESG & Sustainability
Kimberly Knickle is Research Director of the ESG & Sustainability practice at Verdantix. Her research areas encompass ESG regulations and reporting, ESG risk, supply chain sustainability, circular economy, social impact, and sustainable finance. Kim has worked for more than 20 years in the IT industry, providing research and analysis to help companies invest wisely in new technologies. Before joining the analyst industry, she held various roles in IT services, engineering and product safety testing, beginning her career at Underwriters Laboratories, Inc. Kim holds an MBA from Boston University and a BS in Electrical Engineering from Cornell.

Sam Renshaw

Industry Analyst

Sam is an Industry Analyst in the ESG & Sustainability practice. His current research agenda focuses on ESG solutions across financial markets including ESG information providers and sustainability consulting. Sam joined Verdantix in 2021, and previously worked at Moody’s Analytics as part of the Buy-Side Solutions team. He holds a BSc from The University of Nottingham in Economics and is a CFA Level 2 candidate.

Rodolphe d’Arjuzon

MD and Global Head of Research
Rodolphe co-founded Verdantix in 2008 and directs the firm’s research strategy across all practice areas. Rodolphe has over 20 years of experience in technology research and strategy consulting. He previously worked for Barclays Bank and L.E.K. Consulting. Rodolphe holds a PhD in Physics from the University of Cambridge.

Connor Taylor

Senior Analyst
Connor is a Senior Analyst in the Verdantix Net Zero & Climate Risk practice. His current research agenda focuses on carbon management software, climate change consulting services, and the voluntary carbon markets. Connor joined Verdantix in 2021, with prior experience in EHS technology sales and development. He holds a BA from the University of Cambridge in Anglo-Saxon, Norse and Celtic.

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