You’ve probably been hearing the term ‘ESG data’ thrown around quite a bit recently, both by us and across the internet. We’ve had quite a number of people ask us, “What is ESG data?” First I’ll tell you what it stands for, then we’ll go into why it’s important.
What is ESG data?
The ESG stands for economic, social, and governance. It’s a way to measure the “good” that companies do in the world. Each action a company performs that affects the world in a good way, increases their score, while negative actions decrease their score. This is important information for both companies who want to prove their “good” and for investors who want to make responsible investing decisions.
Why is it important?
This question is a little more difficult to answer as it plays into socio-economic issues, politics, corporate responsibility, and more. However, I’ll try not to dive too deep into those areas and instead focus on the uses of ESG data.
In a recent survey by Nuveen, 81% of customers want their investments to make a positive impact on environmental sustainability and 80% of customers say investments should try to make a positive impact on society. This is where ESG data comes into play. If an investment firm can offer a portfolio of globally responsible companies, customers will naturally want to invest.
Save the world and give customers what they want.
That’s the ultimate goal of ESG data.
Interested in getting your own ESG project started? Request a demo of Arena today!