Study

Global Corporate Leaders Leave Investors Blind on ESG - Seite 2

Only about a quarter of the reports (27%) provide a methodology and even fewer reports (19%) provide formulas, approaches or calculation methods on how ESG data was gathered. The study also reveals that not even half (41%) of the reports demonstrated transparency when it came to ESG objectives that had not been met.

Ariane Hofstetter, CEO of research institute KOHORTEN, says: "By measuring and comparing sustainability reporting, we want to ensure more transparency. We are convinced that only through transparency can the global sustainability goals be achieved. We could see that the European indexed companies perform better. Is this a coincidence or the result of regulation and political will?"

Ranking: European companies dominate, US disappoints

As part of the analysis, indicators were developed to provide a ranking of all reports in the sample. With the maximum score being 66 points, most companies' reporting was underwhelming with an average GEM reporting score of a mere 26.

Ariane Hofstetter: "Many of the analysed companies provide ESG data in a variety of formats and make a vast number of references to additional ESG documents, which makes it difficult for even the most experienced ESG analysts to find the relevant information. Some companies communicate on their website, in multiple separate reports or put their information in table-heavy data packs. This is problematic because the information in these unofficial formats can be subject to constant change and make future reviews impossible. This is why we only analysed the official annual reports and official non-financial reports that are constantly archived."

Among the Top 10 companies, the three EURO STOXX companies Inditex (53 pts.), Santander (51 pts.) and BASF (49 pts.) displayed ESG information in their integrated annual reports (I-NFR) most convincingly, while EURO STOXX company Intesa Sanpaolo (48 pts.) and ASX-50 member Westpac Banking Corporation (47 pts.) offered the best separate ESG reports. Only two non-European companies, Westpac (5^th rank) and US-American Walgreens Boots Alliance (8^th rank), managed to make the Top 10 globally when looking at both integrated and separate reports: