Wes Gee Weighs In on Trends in ESG
Last week, investor relations executives and environmental, social and governance (ESG) experts from across North America gathered for IR Magazine’s ESG Integration Forum to engage in a series of discussions around the current state of ESG. Works Design’s Chief Sustainability Officer, Wesley Gee, was invited to participate, and we checked in with him after the conference to get some insight and gather his reflections on trends from 2022.
WD: Let’s start with what you’ve learned from your own research on communications trends and best practices.
WG: We conducted in-depth ESG research and found that companies with an explicit purpose are often developing a connected theme in their ESG reporting, and several are developing reporting suites that are consistent and trackable, rather than an integrated report. We’re also delighted to see a significant increase in companies setting mid- and long-term targets. Net zero commitments are also increasing, though they often lack depth in terms of clear targets and roadmaps.
WD: How is a company’s credibility impacted by the targets it sets and the goals it achieves?
WG: It’s time to “cut the fluff” and shift from broad, overriding statements of good intentions to ambitious and measurable targets that tie directly to why a company exists and how it creates value rather than trying to be everything to everyone. A focused approach means leadership can be clear and consistent with investors on how it creates value and its impacts, with return on sustainability investment (RoSI) numbers as proof points.
WD: What are the reporting challenges to aligning standards, materiality and tactics?
WG: Looking at financial reporting, we notice the Global Reporting Initiative (GRI) dropping off the map, and the Sustainability Accounting Standards Board (SASB) and Task Force on Climate-related Financial Disclosures (TCFD) are clearly in the driving seat. An expanding SASB (as part of the International Sustainability Standards Board) may further impact this and influence how we think of materiality.
On materiality, many companies are using an impact lens; but a double lens – where environmental and social impacts are considered alongside financial materiality – is increasingly gaining ground. What’s critical is how materiality is assessed and applied since the outcomes of this lens can significantly impact ESG strategy, what a company chooses to focus on, how it recognizes intersections, and how it sets targets and a long-term path. Context matters.
On tactics, we support a suite of communications, as it does a better job of getting the right content to the right people at the right time, in the right way. It’s critical that there is a high level of consistency in how you articulate your purpose, desired impact and performance. And it’s vital that everything is accessible.
WD: How important is it for companies to know and adapt to their audience?
WG: It’s essential. Companies should be conducting sentiment analyses and monitoring web and social analytics to regularly understand their audiences. They also need to actually reach out to influential stakeholders to know what they want and where they see “the puck is going.” Companies can improve how they internally collaborate to create a solid communications plan that is regularly evaluated based on real feedback.
WD: Any final thoughts?
WG: Staying ahead requires that you invest in engaging with those who matter most and ask tough, future-oriented questions that help you get beyond pleasantries. Then, it would be best if you collaborated among your colleagues (e.g., investor relations, corporate and internal communications, finance, sustainability) to deliver a winning ESG communications plan that shows you’re crafting your message, reports, web and social in a way that informs and engages with others – that’s where you gain real and lasting support.
