ESG Ratings vs. ESG Framework: Is Impact Valuation the real path forward?
1 min read
In 2005, ESG was introduced as a framework to measure company performance across Environmental, Social, and Governance pillars – pillars that are inherently linked to impact. Over time, however, ESG has been sidetracked by the rise of subjective ratings that have proven to be inadequate.
To achieve real systems change, we need to recognise that sustainability needs to be translated into financial metrics. This can be done through Impact Valuation, which translates sustainability into the language of finance – a language that drives real decisions for investors and businesses.
Key Takeaways: – ESG as a Framework: Designed to assess a company’s impact through Environmental, Social, and Governance pillars. – ESG Ratings: These are not fulfilling their purpose, failing to provide the clarity needed for decision-making. – Impact Valuation: Translates sustainability data into financial terms, enabling leaders to make decisions that integrate both financial and sustainability metrics.
For a deeper dive into why ESG ratings are falling short and how Impact Valuation is reshaping the future of sustainability, contact us on info@gistimpact.com.