ESG Reporting: Framework, Standards & Examples
Find out what ESG reporting is, why it’s important, a framework to follow, and examples to use for inspiration
What is ESG Reporting?
Environmental, Social and Governance reporting, or simply ESG reporting, is what organisations do to communicate to stakeholders their ESG goals and progress towards those goals. It’s how an organisation tells the positive impact story of their responsible business practices and Environmental, Social and Governance (ESG) initiatives.
Why is ESG reporting important?
Besides now being a government mandate in many countries, ESG reporting has many organisational benefits. ESG performance is a determining factor in securing and retaining:
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Investors
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Employee talent
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Valuable partnerships
In addition, research by Harvard Business Review found that:
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90% of 200 studies concluded that good ESG standards lower the cost of capital
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88% show that good ESG practices result in better operational performance
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80% show that stock price performance is positively correlated with good sustainability practices.
The ESG Reporting Framework
ESG issues fall into 3 categories
Environmental issues: e.g. impact on biodiversity, efficient use of resources, waste management, carbon footprint.
Social issues: e.g. product safety, labour standards, community give-back, workforce diversity, equity and inclusion.
Governance issues: e.g. risk management, compliance and auditing, board and leadership makeup, and executive compensation.
ESG Reporting Standards
Historically, ESG reporting standards have been disjointed across the globe. However, they are now more unified.
The Global Reporting Initiative (GRI) is an independent, international organisation that provides a common set of standards for businesses to communicate their environmental impact. The Corporate Sustainability Reporting Directive (2024), which requires EU organisations to conform to mandatory European Sustainability Reporting Standards (ESRS), is based on the GRI structure.
The World Economic Forum, in partnership with Deloitte, EY, KPMG and PwC, has also developed the Stakeholder Capitalism Metrics, which is a set of universal ESG metrics and disclosures.
Head to the ESG Glossary to demystify more sustainability acronyms.
ESG reporting examples
Reviewing the ESG reports of other companies can help you to understand what sort of ESG initiatives are being prioritised and reported on, as well as the different formats organisations use for their reporting.
[Insert ALT Text] - Google ESG Reporting
Highlights:
Google provides reports in PDF format, categorised into Environment, Supplier Responsibility, and Product. These reports are available via a subdomain of the main website, which features information relating to Google’s ESG mission, commitments, progress, and more.​
Planet & Society
The ESG issues covered include diversity and equality, human rights, positive nutrition, and climate action. Current reports and the report archive are available via a section of the main website, which also features stories relating to Unilever’s ESG strategy, initiatives, and more.
Amazon:
ESG issues covered include a net-zero by 2014 pledge, sustainable resource commitments, electric vehicle development, and improvements in packaging. Amazon’s ESG data is available via a subdomain of the main website, in the ‘Our Planet’ section.
Apple
ESG issues covered are broken down into Accessibility, Education, Environment, Inclusion & Diversity, Privacy, and Supplier Responsibility. Apple’s ESG information is available via the investor relations subdomain of the main website, which also lists SEC Filings.
Domino’s
ESG issues covered are broken down into Accessibility, Education, Environment, Inclusion & Diversity, Privacy, and Supplier Responsibility. Apple’s ESG information is available via the investor relations subdomain of the main website, which also lists SEC Filings.
Highlights:
ESG issues covered are broken down into Food, Customers, Environment, Community, and People. The reports are available via the investors subdomain of the main website, which features a strong written statement from Chief ESG Officer, Marika Stegmeijer.
ESG reporting FAQ
What are the ESG reporting requirements?
ESG reporting requirements vary depending on the country or region where your company operates. However, it's important to note the significant shift in the ESG reporting landscape towards the adoption of globally harmonised disclosure standards. These standards aim to facilitate consistent and transparent reporting across borders, encompassing environmental stewardship, social responsibility, and corporate governance aspects.
What is the current state of ESG reporting?
The current state of ESG reporting varies across regions. In the UK, significant progress has been made. As of 2022, large companies listed on the stock exchange, those with annual turnovers exceeding £500 million, or with over 500 employees, are required to include sustainability matters in their annual reporting. This is required under the expanded Companies Act 2006. Plus, the introduction of Sustainability Disclosure Requirements (SDRs) in 2023 has further formalised ESG reporting in the UK. A similar trend is observed in the rest of Europe.
In the United States, the US Securities and Exchange Commission (SEC) proposed climate-risk disclosure requirements in March 2022. These requirements aim to expand the annual reporting obligations of publicly traded companies, making it necessary for them to discuss financially material, climate-related risks.
Is an ESG report the same as a CSR report?
No, an ESG report and a CSR report are not the same. While both measure a company's impact on society, they represent different perspectives. A CSR report focuses on an organisation's internal Corporate Social Responsibility initiatives, highlighting its efforts to fulfill a corporate purpose. On the other hand, an ESG report goes beyond internal initiatives and offers a comprehensive sustainability assessment, specifically catering to the needs of investors.
60-second takeaways
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Sustainability promotes responsible practices that ensure long-term environmental, social, and economic wellbeing for all, now and into the future.
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Environmental protection, social equity, and economic viability form the basis of sustainability initiatives.
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Sustainability and ESG are separate but linked concepts.
Sustainable investments are based on financial returns as well as impact on the environment and society.