ESG Spotlight: ESG Visibility Hub of Deutsche Börse

Every day, critical decisions are made by businesses and governments around the world which have a direct impact on their stakeholders.

These decisions are rarely based on financial information alone, rather they are based on an assessment of risk and opportunity using information on a wide variety of immediate and future issues – In recent years ESG data has become a critical component of such non-financial information.

Concretely, the comprehensive disclosure and effective management of ESG data by businesses can be facilitate the following:

1.    Capital Attraction

• Investors are increasingly demanding greater transparency from businesses on ESG-related data and risks
• A high level of disclosure and reporting enables investors and capital markets to incorporate ESG-related data and risks into their investment decisions and better align capital with sustainable practices to make a positive impact

2.    Regulatory Compliance

• National and international regulatory authorities are increasingly implementing mandatory reporting directives to oblige businesses to disclose data on their ESG performance. (E.g. EU NFRD & CSRD directives)
• Though initially more focused to large corporates, the scope of such legislation is expected to broaden over time, therefore organizations should already act today to ensure business readiness

3.    Corporate Sustainability Performance

• ESG performance improvements and reports demonstrate how a company mitigates risks and generates sustainable long-term financial returns
• By implementing an ESG reporting concept into their organization, businesses can gain a greater understanding of risks and opportunities that they are facing

4.    Corporate Reputation

• ESG reporting is a key part of communicating sustainability performance and impacts, and enables trust to be created in businesses
• Disclosure and effective management acts as meaningful signal to the external world of a company’s commitment to sustainable business practices

Creating trust by transparency

With the ESG Visibility Hub we support the transformation to a sustainable environment and accompany #ListedinFrankfurt companies on their ESG journey.

At a glance: ESG-Reports, Ratings und Research

If companies want to successfully attract investors, their own ESG strategy plays an essential role. Deutsche Börse Cash Market picks up on this megatrend in the capital markets and gives issuers the opportunity to market their ESG efforts transparently and bundled in the ESG Visibility Hub. This enables companies that have already established sustainability reporting to extend their reach to investors.

ESG-KPI-Report: Resource-efficient entry into sustainability reporting

While the reporting of non-financial disclosures is relatively widespread among large public companies, the practice is limited among small- and mid-size companies.

For SMEs a lack of resources, both financially and employee-wise, can pose significant barriers to reporting sustainability-related information. Furthermore, for many SMEs there is a lack of clarity as to what specific ESG data points are material for disclosure.
Deutsche Börse and ISS ESG, the responsible investment arm of Institutional Shareholder Services Inc. (ISS)*, have therefore developed an ESG KPI Report to help SMEs in particular get started with ESG reporting by providing guidelines and best practice examples. Companies that already publish sustainability reports can upload the ESG-KPI-Report in addition to their existing ESG data in the ESG Visibility Hub.

Interested issuers can request more information and access to the ESG Visibility Hub at issuerservices@deutsche-boerse.com.

The SFB1 and ISS ESG have compiled a list of KPIs as a common set of basic ESG indicators, aimed as a first step for issuers as they begin providing non-financial disclosures. These KPIs are comprising 17 different metrics across environmental, social and governance themes. The reporting of these KPIs will facilitate both reporting and implementation of sustainability in companies and allow them to be more transparent and accountable to all stakeholder groups.

>> ESG Visibility Hub on boerse-frankfurt.de/en

The ESG profile of the companies may include the following:

• ESG short profile
• Research
• Reporting (Non-financial reports)
• Ratings from various agencies
• Climate disclosure (CDP is a global non-profit organization that operates the world's leading environmental disclosure system)

*ICS, which is a wholly-owned subsidiary of ISS, provides compensation, governance, and sustainability tools and advisory services to help companies improve shareholder value and reduce risk.  The teams which produce ISS’ research and analytical offerings operate separately from ICS and ISS will not provide preferential treatment to, and is under no obligation to provide a favorable rating, assessment or any other favorable result to any corporate issuer (whether or not that issuer has purchased products or services from ICS).