The Securities and Exchange Commission is diving into ESG issues, aggressively. There are disclosure proposals, a task force and lawsuits. More rules are expected any minute, with more required disclosures. So what does this mean for a company trying to do the right things?
Don’t panic. For companies engaged in improving on ESG factors, oversight, accountability and some standardization will be ok in the end. (Not to minimize the additional work.) And, ESG vs. Sustainability as a name will matter less once the SEC decides to weigh in. But some companies have been trying to appear more environmentally advanced and more ahead of their peers than they may actually be. Here are a few guidelines for communicators:
Tell the Truth
Fraud has always been a crime. Stick with the truth. Be honest about your progress and opportunities. The SEC might come looking for more information, especially on climate risks, but uncertainty is worse. Today it’s climate in the crosshairs, but ESG encompasses much more. The SEC is currently focused on material impacts to the company from ESG risks. Companies might also look to their impacts on the communities where they operate. There is a big continuum here, and honesty is always the best policy, even when the answer is “we are working on it” (if you actually are).
Tell Your ESG Story
Don’t wait to be asked, answer the questions you would want to know. Work to create your credible ESG story, a narrative your company can align on. Use journalistic techniques and answer those probing questions yourself, before someone answers for you. Don’t be vague or generic, support with data where you can and give the context too. People remember stories more than a litany of facts, humanize what you are doing.
Show Don’t (only) Tell
Show what you stand for, how you are different, and why it matters. Some information may make its way into your 10-K, but that is not the full picture. Your people, facilities and products or services in action bring your story to life. Use compelling infographics and images, and navigation to make it useful. When you show audiences what you are doing and the impact it is having on the world, your actions will speak louder than pages and pages of words.
How Ideas On Purpose Can Help
For over 20 years IOP has been helping companies of all sizes with their purpose-driven communications, including corporate reporting and ESG storytelling. Our strategy, content, digital and creative teams are ready to help you define and tell your ESG/Sustainability story and meet your reporting goals. Feel free to email us, we’re happy to discuss the possibilities.
Photo by Berta Ferrer on Unsplash