“There is a bubble of uncertainty about whether companies can truly be ESG-graded in a consistent way” - Solidatus Architect and ESG Specialist John Tobin spoke to Investment Week about the complexity of the ESG space and the current lack of clarity and consistency when it comes to ESG ratings.
ESG investing funds have taken in over $70billion this year alone, but for a business trying to meet rating agencies' often rather conflicting and inconsistent requirements, ESG is posing a problem - when in reality it has been designed to solve a wide variety of global environmental and social issues.
Just considering how different the data gathered for the EU’s Sustainable Finance Disclosure Regulation for disclosures recommended by the Task Force for Climate Related Financial Disclosures (TCFD), is to the data gathered by SAM Corporate Sustainability Assessment (for S&P) and by Sustainalytics (for Morningstar), it's easy to understand why companies are feeling overwhelmed by the ESG journey that lies ahead.
This doubt around whether an organisation can be thoroughly and consistently ESG-graded across the board is something which will be affecting businesses for some time to come, but Solidatus has developed a new ESG model specifically created to bolster data transparency, achieve ESG objectives and demonstrate success through public ratings.
To find out more, read the Investment Week article* or download our ESG Factsheet:
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*this article sits behind a paywall