EDMCorner — ESG Data: Are We Making Any Progress for Our Planet?

Eric Bigelsen, Global Head of Industry Engagement and Senior Advisor for ESG, EDM Council, speaks with Robert Lutton, Vice President, Sandhill Consultants, about the importance of ESG in today’s data management scenario within organizations.

ESG stands for Environmental, Social, and Governance, Bigelsen explains. The environment part is focused on climate, carbon emission, air, water, and biodiversity-related issues. The social aspect includes social and societal issues like gender, equality, compensation, child labor practices, health and wellness, and community. Governance is about making sure there are appropriate controls, procedures, and oversight for organizations.

Speaking on the EDM Council’s goals, he says that the whole notion of getting involved with ESG came about because several concerns surfaced regarding what’s happening in the ESG space.

“Once you dig in, you recognize ESG is very much a data management challenge. It's not just about the measurement of various metrics and factors, but it's really how you connect the data and provide that data to a whole host of other professionals through the entire ESG ecosystem,” Bigelsen says. One group goal — initially and still today — is to create broad awareness of what's happening in the ESG space for all data management professionals. The group also aims to provide the education necessary to ensure everyone is upskilling themselves with the tools needed to manage a future infused with more ESG regulations and jurisdictional issues.

Yet another group goal is to provide a service along the lines of education and awareness. This includes presentations and webinars featuring various subject matter experts speaking on the regulatory and standard side or on the data management side. “We also determined if there were areas where we could articulate some best practices to convey to the marketplace — guidance from a data management perspective, looking at a problem through the data management lens.” Additionally, they were successful in publishing two documents last year.

Shedding more light on the ecosystem challenges, Bigelsen notes that reporting entities don't fully understand the rules of engagement with regulations and standards, and as a result, some companies haven't even started to report.

“We've been working with mostly a voluntary environment until recently, and there's a lot of incomplete data and gaps that exist for organizations highly dependent upon data and information to do their analysis and evaluation. That creates a whole set of unique challenges for the rating providers and the data aggregators. Each organization approaches things differently. They develop survey tools and use various extrapolation methods and models, and algorithms to try to fill those gaps. That's an area of concern — that there is transparency around the techniques being used so the marketplace knows how they're getting this information,” Bigelsen concludes.