Purpose of Research:

A lot of non-profit organizations are proactively engaging the improvement of ESG management, including affiliations of guilds and governments, academic institutions and NGOs. They either issuing and editing standards. or providing open source scoring systems, or doing cutting edge research. Understanding they work is crucial to getting the big picture of the future of ESG.

Number of individual students required: 1

Defined Tasks:

Our previous research shows that ESG-Sustainability scoring is an emerging business recently. There are three types of organizations, non-profit or for profit, in the market acting as providers.

1. For-profit

This is the kind of direct competitors. They have two different business models.

• Provide customized sustainability management solution for customers by charging development fee + licensing fee. For example, Rockwell Automation.
• Establish a universally accepted scoring system, and charge everyone who want to access the detail score of a specific company. For example, Sustainalytics, Refinitiv, etc. On top of what we already have looked at, there are still a lot of institutions waiting to be researched, including famous MSCI, Bloomberg, S&P and ECPI.

The latter business model has a bigger customer base than the former because almost all institutional investors have their own model/solution to quantify ESG factors by dollar, all they need is data.

2. Non-Profit

There are also a lot of non-profit organizations providing ESG scores and performance reports. The interval of report renewing is very long, normally from 1 year to 2 years, because of the lack of funding and limited data access. RMI and CDP are examples of this kind of competitors.

3. Affiliations/Academic Institutions

• Affiliations of national governments, guilds and UN are also leaders in this market. Most of them only provide guidelines for companies and investors to build their own dashboard/report, while others also established a forum/community for members to share their research.
• Academics institutions, especially business schools, are actively conducting research and appealing for the adoption of “triple bottom lines” instead of traditional unique economic bottom line. Some of research is quite insightful and provide comprehensive frameworks of appraising ESG performance and connecting the performance to economic bottom line.

Both kinds in this category are not “pure competitors” but rather “semi-competitors” that also have high potential of becoming partners. PRI, TSM, and SASB are examples of government affiliations, while Wharton and Schulich are those of academic institutions.

From demanding side, Big companies, such as Rio Tinto, and institutional investors, such as big banks including RBC, are developing their own appraisal systems, while others are proactively looking for solutions.

Expected outcomes:

1. Interview non-profit Organizations/Affiliations/Academic Institutions to learn:

a. Trends of upgrading standards and increasing regulations.

b. Cutting-edge research.

c. Difficulties in data collection and shortening the interval of reporting.

2. Compare existing standards and scoring systems to summarize factors they are measuring.

3. Comparing reputations of different scoring systems/standards

Remarks:

Students in Richmond, BC will be considered first

Mentorship and supervision will be provided by member Strategic Marketing team as well as Executive Vice President of Corporate Strategy.