Precisely has announced that it is building partnerships to help organisations build trust in their data for their ESG reporting initiatives. Organisations worldwide are struggling with the rapidly evolving requirements of ESG legislation. Within varied legislation and several different frameworks in place, there is a need, if not a full understanding of the data metrics they need to build reports. One of the big challenges is that ESG reporting is more varied, often qualitative and very unlike black-and-white financial reporting.
Collating the data for this reporting is rarely easy. The data can come from multiple sources across the organisation. The Precisely Data Integrity suite can help build the pipelines to their data sources, ingest, organise, clean and enrich that data with data sets to add context and meaning, such as geographic, demographic, or economic data.
In combination with the Precisely Data Integrity Suite, the firm has developed and offers expert strategic services around ESG data. Precisely’s strategic services team provides consultative services to ensure that a data integrity strategy is correctly embedded to help overcome compliance challenges.
Precisely makes a difference at Vontobel
Precisely has partnered with Vontobel, a globally operating investment manager with Swiss roots. Like many investment firms, they are urging sustainable investment. Vontobel has taken the lead on this with advisory services around ESG investment. It also ensures that all its investment strategies are ESG compliant with the assistance of the Precisely Data Integrity suite. The challenge is that its wealth management clients have different views of sustainability. It means that the Vontobel approach must be flexible.
Dennis Podszius, Senior Relationship Manager, ESG Investment Specialist at Vontobel, commented, “What does sustainability mean for you personally? This is the first question we always ask our clients. Because no matter where they prefer to take measures in their own private life – for example, by driving an electric vehicle, eating less meat, or recycling more – our experience shows that many clients prefer to base their investments on their own convictions. So we want to make sure to reflect these as much as possible in their portfolio.”
That means Vontobel must potentially use different criteria for each client to identify the best mix of investment solutions. To achieve that, they need to clearly understand the ESG data they have access to. To do that, they turned to Precisely. The Data Integrity suite has helped improve the quality of ESG data. The process for portfolio valuation, now have better data analysis and quality and completeness checks.
Christina Schack, Head of Data Platform at Vontobel, commented, “Collecting data is nothing new for investment companies, but the challenge now is how to cater to the new volumes of data needed for meaningful ESG measurement and figure out which data elements are the most important. Using proper tools to automate data quality checks in the data cleansing process is very important to handle and control the immense amount of ESG data. Implementing automated checks and ingestion of the data has greatly helped to reduce the manual work and achieve more accurate analysis for investment strategies.”
Data integrity Software and ESG services combine
Precisely’s combination of software with expert services, helps companies like Vontobel improve the data quality of their ESG metrics. Even as they evolve, the Precisely Integrity suite helps maintain compliance with industry regulations. The data enrichment services that Precisley can provide around adding geographic, demographic, or economic data, bring context to the data that organisations collate. This helps to surface insights from across the organisation.
Precisely is also working with Verisk Maplecroft, a leading global risk consultancy firm and specialist in sustainability, resilience, and ESG. Verisk Maplecroft recognises the importance of data integrity for ESG Reporting. Mikkel Skougaard, Director of ESG Reporting and Strategy at Verisk Maplecroft, will take the stage at the upcoming Trust ’23 data integrity summit during a panel session on May 17 that will demystify ESG reporting.
Skougaard commented, “A more powerful way to approach ESG reporting is to hold it to the same standard of governance, processes, controls, assurance, and expertise that you would with your financial reporting. Developing a data-driven ESG report is the most important factor, but this needs to be supported with high-quality contextual narrative in order to unlock maximum value.”
ESG Reporting can make a difference
As many organisations are now aware, ESG Reporting is not easy. It is critical that they can trust the data used to produce reports. Which, if inaccurate, may, in time, incur penalties similar to those around data protection. Ensuring the data is compliant, enriched and accurate is a fundamental requirement. Research by EY identified that 41% of finance leaders believe their current processes would not stand up to the scrutiny of basic assurance standards.
Organisations are already diverting funds to ESG initiatives. A recent survey by Verdantix revealed that 57% of firms saw an impressive double-digit increase in budgets in 2022 for ESG. This is not just about data and reporting on strategic sourcing and operational decisions. The challenge is that without accurate data, organisations cannot benchmark and identify areas for improvement to make a difference, enabling an improvement in ESG KPIs.
Skougaard will attend Precisely’s upcoming Data Integrity Summit, Trust ’23. He will join a panel discussion on the importance of trusted data in harnessing true business value from ESG reporting and advice for navigating evolving regulations and consumer expectations.
Precisely CRO Pat McCarthy will lead the panel alongside Skougaard and Matthew Rusk, Head of Global Reporting Initiative (GRI) North America. McCarthy commented, “Modern business practices demand complete transparency. Investors, employees, and consumers alike want to know the companies they’re investing in, working for, and buying from not only meet their personal standards of ethics but are doing their part to create a better world. To stay compliant and achieve meaningful outcomes businesses need to prioritize data integrity in sustainability reporting and build trust in the data fueling their decisions.”
Enterprise Times: What does this mean
ESG reporting and initiatives are proving increasingly important. As far back as 2019, Mckinsey published a paper identifying five ways ESG could create value within an organisation. At the heart of the challenge is data, and this is something that Precisely are expert at. Without trust in data, business leaders dare not make data-driven decisions. However, evidence-based decisions that rely on accurate data have proven successful in several fields, as highlighted by Pfeffer and Sutton in 2006. Perhaps learning more about your ESG data and how to improve your trust in it is a good first step.