Where is your company on its ESG journey, where is it going and how are you measuring progress?
It is first important to consider where your organization lies on its ESG disclosure journey. One way of framing it is to think about which ‘ESG life stage’ your organization may be at.
Nascent: These are firms that are just starting out with a relatively low profile in the ESG space. They are perhaps still considering the metrics, KPIs or frameworks to use for ESG disclosure and considering how to bring ESG talking points into their earnings call.
Key focus: ESG website as a distinct online portal to collect disclosures.
Familiar: These are companies that are comfortable with their place in the ESG ecosystem and working on being included in ESG frameworks. They are settling on the KPIs and frameworks they use to benchmark and measure performance, and thinking about how to make sure their ESG strategy follows through into earnings.
Key focus: Tying performance measures to ESG performance.
Mature: These are companies that have long been innovative ESG communicators and have long reported on such factors. They are definitely included in ESG frameworks and well covered by ESG ratings agencies. They regularly refine their approach to how they address ESG in earnings calls and fine-tune their strategy.
Key focus: Drilling down into specific issues and topics in granular detail with division heads and/or subject matter experts.
Essential is a listed holding company for regulated utilities, providing water, wastewater and natural gas services across North America. Its ESG manager, John Catalano, has headed up a dedicated ESG function at the firm since July 2020 and describes it as at a ‘familiar’ stage in its journey.
‘We feel really good about our overall ESG efforts under John’s leadership,’ says Brian Dingerdissen, Essential’s vice president and chief of staff for investor relations and communications.
‘We are at a really good place with our reporting and with how the ratings agencies see us today. Though we are still evolving as to how we share our ESG story in places other than our formal reporting, I feel as though we are ahead of the wave right now.’
