background image

ESG in finance: how to unleash innovation through precision data management

author image

By illuminem briefings

· 2 min read

illuminem summarizes for you the essential news of the day. Read the full piece on Finextra or enjoy below:

🗞️ Driving the news: The evolution of ESG (Environmental, Social, and Governance) reporting has transformed it from a compliance obligation into a key driver of innovation and competitive advantage in the finance sector
• Financial institutions are now leveraging ESG criteria not only to showcase responsible practices but also to fuel the creation of innovative products and services

🔭 The context: Despite advancements, the finance industry faces challenges related to data quality and consistency in ESG reporting
• A significant number of investors cite the prevalence of "inconsistent and incomplete" data and the risk of greenwashing as major obstacles to ESG investing

🌍 Why it matters for the planet: Accurate ESG reporting is crucial for directing investments toward sustainable and socially responsible businesses
• By enhancing data management and reporting practices, financial institutions can play a pivotal role in driving the transition towards a more sustainable and equitable global economy

⏭️ What's next: Financial institutions are urged to adopt rigorous data verification, conduct comprehensive portfolio assessments, enhance due diligence processes, and embrace transparent reporting practices
• These steps are essential for effectively integrating ESG criteria into investment decisions, combating greenwashing, and unlocking innovation within the sector

💬 One quote: "This may seem like too big of an ask, but that's what financial institutions have done with their clients' financial reports since lending and investing were invented," emphasizes the importance of due diligence in evaluating ESG criteria.

📈 One stat: According to a BNP Paribas survey, 71% of investors view the lack of consistent and complete data as the primary challenge to ESG investing, with 61% concerned about greenwashing.

Click for more news covering the latest on sustainable finance

Did you enjoy this illuminem voice? Support us by sharing this article!
author photo

About the author

illuminem's editorial team - providing you with concise summaries of the most important sustainability news of the day.

Follow us on Linkedin, Twitter​ & Instagram

Other illuminem Voices

Related Posts

You cannot miss it!

Weekly. Free. Your Top 10 Sustainability & Energy Posts.

You can unsubscribe at any time (read our privacy policy)