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ESG reporting: Why full disclosure matters

Leon Saunders Calvert
Leon Saunders Calvert
Head of Sustainable Investing & Fund Ratings

Sustainable investing requires ESG data you can trust. Find out how Refinitiv is driving the highest standards of corporate ESG reporting, with no room for short-cuts or ‘guesstimates’.


  1. High standards of corporate ESG reporting are critical for accurate investor information, public discourse, and regulatory guidance.
  2. Refinitiv ESG scores do not use, create or collect data that is not disclosed or publicly available.
  3. If companies don’t disclose data on targets and policies, we assume they don’t have them, which negatively affects their ESG score.

High standards of corporate ESG reporting — Environmental, Social & Governance — are crucial for stakeholder insight. That’s why at Refinitiv we adopt a policy of full disclosure on the reporting of ESG risks.

If a corporation does not disclose its ESG risks, we will not assume they are ‘industry-average’, or ‘guesstimate’ data for them based on their peers in an attempt to achieve a comprehensive dataset and do the work that companies themselves should be doing.

In other words, Refinitiv’s ESG scores penalize companies for not reporting on ESG metrics.

Leon Saunder Calvert quote. ESG reporting: Why full disclosure matters

This may sound a little severe, in that it does not offer ‘the benefit of the doubt’ — and we always strive to be reasonable and accommodating!

But consider what ESG is all about. It is not philanthropy, or charity, or the doing of good deeds for their own sake.

All these things may, quite reasonably, be done privately. Rather, ESG is about transparent disclosure of certain risks that arise as a result of pursuing business interests.

In other words, the disclosure is all.

Importance of ESG reporting

At Refinitiv, we believe that company disclosure and standards of reporting on these issues are critical for driving accurate investor information, public discourse, and regulatory guidance.

We also believe that transparency is critical to driving positive outcomes at both a financial and social level.

Transparency is critical to driving positive outcomes. ESG reporting: Why full disclosure matters

As a result, for the purposes of company scoring, we do not use, create or collect data that is not disclosed or publicly available.

This ensures we can create a complete line of auditability all the way from documents (such as annual reports) to the company data points in our database through to company scores.

Transparency of ESG data

Take a look at our ESG company scoring methodology as a demonstration of our commitment to transparency and auditability in this space.

This gives investment managers more confidence to integrate ESG into investment decisions because they can back up the decision to investors by providing hard data, the same way they would with traditional or fundamental (although ESG is fundamental in our eyes) research.

For Refinitiv ESG data is fundamental data, not alternative data, and is treated on a par with all other investment grade data to inform institutional decisions on allocation of capital.

The transparency of our data also facilitates and enriches engagement with issuers in a way that non-transparent scoring simply can’t.

Leon Saunders Calvert quote. ESG reporting: Why full disclosure matters

Finally, by relying solely on a company’s own disclosure, we can ensure first-hand information, while providing transparency into the current state of that company’s disclosure practices.

We strive to be the industry-standard database that reflects official company disclosure on ESG metrics. For this reason, we can offer no shortcuts to the way we score the voluntary disclosure of such information.

Watch: How is Refinitiv ESG data gathered?

Penalties for non-disclosure

Although our upcoming updates to scoring methodology will reflect even more direct penalization for non-disclosure, if companies don’t disclose on targets and policies, we assume they don’t have them, and this negatively affects the company’s score.

Some other market participants send surveys to, or conduct interviews with, management in order to fill disclosure gaps. However, if there isn’t transparent disclosure in the public domain, we don’t give companies credit.

As you can probably tell from the tone of this blog post, honest disclosure is different from marketing. In one domain, you can try and be everybody’s best friend. In the other, sincerity must be its own reward.

Want to make sound and sustainable investment decisions? Discover how ESG data from Refinitiv can help.