Landmark Study Launched to Investigate the ‘Silent’ ESG Data Quality Problem in Capital Markets

WASHINGTON - Nov. 6, 2015 - PRLog -- The Global ESG Regulatory Academy™, the professional education arm of the specialist consultancy and think tank CSR Insight™ LLC, has launched the first independent comprehensive study of an emerging problem that represents a rising risk to global capital markets, entitled “The ESG Data Quality Problem: What Issuers, Asset Managers, and Regulators Need to Know”.

The recent dramatic growth in voluntary and mandatory corporate reporting worldwide on environmental, social, and governance (ESG, also known as sustainability) issues, in response to rising investor demand for full and fair corporate disclosure on these issues, is being driven by the escalating nature of global environmental and social issues and their increasingly powerful impacts upon corporate supply chains, business models, and balance sheets. However, two separate and discordant spheres of corporate ESG reporting have developed, each with disparate reporting requirements and with different standards for system/process rigor, quality control, and data verifiability:

·      -- Corporate voluntary ESG reporting, utilizing frameworks such as Global Reporting Initiative, Carbon Disclosure Project, and UN Global Compact; and

·      -- Corporate mandatory ESG reporting, which has seen momentous developments in the last five years, with 38 countries worldwide enacting new ESG securities law and stock exchange regulatory disclosure requirements.

This disaggregated state of ESG reporting has given rise to the ESG data quality problem, which some view as a ‘silent white elephant’ in global capital markets, as it can undermine investment analysis and transaction analysis, impede proper corporate management of ESG issues, and increase corporate regulatory noncompliance and stakeholder litigation risks.

According to our research, a large percentage of the corporate ESG data being reported, including ESG data being reported by both issuers and third-party ESG research firms, consists of data inconsistencies, inaccuracies, and incompleteness, and under-recognition and undervaluation of ESG issues and risks," says Linda Lowson, Esq., CEO of CSR Insight™ LLC. "The problem exists regardless of the ESG data provider, regardless of the ESG data source, and regardless of the ESG metric for which the data is being reported.”

The Research Study will build upon the extensive ESG legal/regulatory analyses and capital market studies conducted by CSR Insight™ LLC since 2008 as part of its Global ESG Regulatory and Reporting Research Program. The Study is expected to be published April 1, 2016, and will examine all aspects of this problem, including its main root causes, key global capital market impacts, and remediation and mitigation solutions. Sponsorship applications are available now and must be submitted by November 30, 2015. Sponsors will receive additional analyses that will not be part of the main report.

For further information, please contact Linda M. Lowson, Esq., CEO.

About Global ESG Regulatory Academy™ and CSR Insight™ LLC:

Global ESG Regulatory Academy™ is the leading independent provider of professional education and training on Global ESG Regulation and ESG Regulatory, Voluntary, and Integrated Reporting, serving corporate management, boards, asset owners and managers, and legal, compliance, audit, finance, and risk management executives. CSR Insight™ LLC is the leading independent specialist consultancy in worldwide ESG-related securities regulatory reporting and compliance.