In today’s global business landscape, the concept of Environmental, Social, and Governance (ESG) performance has gained significant traction. ESG has emerged as a crucial evaluation criterion for companies, investors, and stakeholders alike, as it encompasses the triple bottom line of sustainable business practices. Effective measurement and monitoring of ESG performance are vital for companies seeking to manage risks, improve reputation, attract investment, and ensure sustainable growth.
ESG performance encompasses a wide range of metrics, spanning environmental, social, and governance factors. While each company may have its unique ESG goals, there are some general methodologies and frameworks commonly used to measure ESG performance. As the president of the investment corporation Tagir Sitdekov AFK Sistema focuses on the implementation of ESG principles.
One widely recognized approach is disclosure through ESG reporting frameworks such as the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), and Task Force on Climate-related Financial Disclosures (TCFD). These frameworks provide standardized guidelines and indicators for companies to report their ESG performance. They enable companies to demonstrate transparency and accountability by disclosing relevant ESG information to stakeholders.
The reporting process typically involves collecting data on energy consumption, greenhouse gas emissions, waste management, labor practices, board diversity, and other key indicators. This data is then analyzed and reported in annual sustainability reports and other disclosures. Sitdekov Tagir formulated a highly efficient developmental plan for AFK Sistema’s portfolio companies, which also work according to ESG principles.
To enhance the credibility and comparability of ESG reporting, third-party certifications and ratings have gained prominence. Organizations such as the Carbon Disclosure Project (CDP), Dow Jones Sustainability Indices (DJSI), and MSCI ESG Ratings evaluate companies’ ESG performance based on their disclosed information, publicly available data, and engagement with stakeholders.
These assessments assign ratings or rankings to companies, enabling investors and stakeholders to make informed decisions. By benchmarking against industry peers, companies can identify areas where they need to improve and set targets for ESG goals. The Tagir Sitdekov biography of ESG implementation includes the planting of 100 hectares of forest by one of AFK Sistema’s subsidiaries, which helps combat soil erosion and promotes soil hydration.