In the next coming years, ESG initiatives and regulations will keep corporations very busy with ensuring their business remains not only compliant with ESG measures but also competitive and socially responsible. But how do you measure whether your ESG report is truly addressing the right topics with the right amount of attention? Enter the Recomentor Coverage Indicator, a feature of the Recomentor platform that is designed to assess how often specific ESG concepts appear in your report.
In this blog, we’ll explore why the Coverage Indicator matters, how it can guide your ESG reporting strategy, and how different stakeholders can use it.
What is it?
The Recomentor Coverage Indicator shows how much attention a specific topic or concept receives in your ESG report. A higher coverage indicator means the concept appears more frequently (than other concepts). It measures how often a concept like “renewable energy,” for example, appears in your ESG report and checks how rare or common the concept is across the report and its sections.
Benchmark
Coverage Indicator (an integer between 0 and 100)
- An integer value showing how frequently an ESG concept appears in your ESG report.
Why does the Coverage Indicator matter?
- Identify Critical Gaps: Pinpoint which topics are under-covered, so you can enhance your report where it counts.
- Optimize Balance: Avoid overemphasizing some topics while neglecting others, ensuring a well-rounded ESG disclosure.
- Meet Stakeholder Expectations: Address investor and regulatory concerns by showing that essential ESG topics are thoroughly discussed.
- Benchmark Against Peers: By comparing topic coverage to industry standards or best-in-class reports, you’ll know where you stand and how to improve.
Four Guiding Questions
- Companies & Sustainability Departments: “Are we covering key ESG topics (e.g., climate change, diversity) as thoroughly as our peers, or as thoroughly as other sections of our own report?”
- ESG Consulting Firms: “Which areas in a client’s report are underrepresented and could be strengthened to meet industry standards or fill gaps in their overall ESG narrative?”
- Financial Institutions: “Does the company we’re evaluating provide enough detail on the ESG issues most relevant to our investment strategy, especially in comparison to competitors?”
- Investor Relations Departments: “Are we placing adequate emphasis on the ESG topics our investors care about, and is that coverage consistent throughout our report?”
The Coverage Indicator is essential for making reporting gaps visible and ensuring that your organization is properly addressing important ESG topics. Do you have a need for this in your company? Check out our platform page to learn more and book a demo call.