September 2, 2021

What ESG metric types can corporations use for compensation? Think ESG effort!

While companies are under pressure to have a strong ESG performance, we’ve seen that companies focus on very few aspects of ESG. This could include emissions levels, the diversity profile of the employee base, etc. These hard facts are presented as hard numbers.

Reporting only a few ESG metrics may mean missing the opportunity to paint a fuller picture of a company’s ESG efforts, particularly if a company is in early stages of addressing certain ESG topics. How can a company tell the fuller story of its ESG activities and performance?

Obermatt sees an opportunity to include non-numeric ESG metrics that capture a company’s effort through achievements such as the implementation of specific ESG strategies, policies, programs, reporting standards, audit practices, etc.

We encourage companies to go broader when selecting the ESG metrics to include in their ESG performance assessments. This could mean including metrics to assess ESG efforts as well as including more ESG topics, beyond those getting the most attention at the moment.

Join the Obermatt ESG Panel and hear best practices in ESG reporting and compensation from finance, HR and sustainability peers.

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