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EDMC study highlights 11 key challenges around ESG data

EDMC study highlights 11 key challenges around ESG data

The EDM Council (EDMC) has just released a study which provides recommendations to ratings providers and data aggregators (RPDAs) on major challenges around the ESG data supply chain.

In the study - ‘ESG Data Management: Rating Providers and Data Aggregators’ - cross-industry trade association for data management and analytics, EDMC, recognises that while RPDAs play a vital role in the ESG ecosystem, they are coming up against their own data and analytics challenges.

Eric Bigelsen, EDMC head of industry engagement and head of the ESG workgroup, commented: "As ESG has grown in prevalence, so have the data management challenges that RPDAs have faced. Our goal with our latest ESG research is to simplify the ESG data supply chain and create a common framework within which these entities can operate.”

To rationalise the data challenges, the study spotlights 11 key hurdles, and makes strategic recommendations for each:

  1. Complexity of Standards Setting
  2. Model Governance
  3. Documenting data points to materiality
  4. ESG Metric Effectiveness
  5. Data Gaps
  6. Version Control
  7. Changes and Trends in Source Data
  8. Third-Party Data
  9. Scenarios and Models
  10. External Assurance of ESG Data
  11. ESG Data Management Requirements

"We aim to bring more clarity and understanding to this evolving sector while demonstrating the benefits of ESG in delivering sustainable outcomes," said Bigelsen.

This EDMC report is the second instalment in a series of papers detailing the findings of a nine-month study on ESG data challenges. The research combines input from over 80 participating organisations and over 150 professionals.

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