Navigating climate uncertainty: Strategic planning with imperfect data
by Sam Gill
Environmental, Social, and Governance (ESG) reporting remains pressing in the dynamic world of sustainability. This has compelled businesses to align more with transparent sustainable practices. EcoVadis has risen to prominence in this dynamic landscape due to its usefulness, quality, and easy-to-use portal. Through this, businesses and their value chains are being steered towards sustainability excellence in a more pragmatic way.
EcoVadis has played a pivotal role in the ESG ratings and rankers' landscape since its inception in 2007. The momentum behind EcoVadis continues to grow as businesses increasingly recognise the importance of robust reporting, demand from investors, and heightened stakeholder expectations. This blog explores the rising popularity of EcoVadis, the methodology behind the assessment, and how we can help your business harness the full power of EcoVadis.
Companies use EcoVadis assessment to demonstrate their ESG commitment and performance to investors and other stakeholders. The assessment is based on a company’s management system performance in four areas – Environment, Labour & Human Rights, Ethics, and Sustainable Procurement. The EcoVadis rating methodology assesses the management system's effectiveness by evaluating three key management pillars (policies, actions, and results). For continuous improvement, these are split into seven management indicators that follow the general management system principle of ‘plan, do, act, check’.
EcoVadis gives a score of 0-100 which is accompanied by a medal or badge, depending on the quality of the company’s management system. The medal system is rooted in a company’s percentile score, calculated based on the company’s performance amongst rated companies in EcoVadis’ database. This is marked with either bronze, silver, gold, or platinum medals, or the 'committed' and 'fast mover' badges, which last for a year. A company can share this publicly on their social media platforms and in their reports. This allows the company to demonstrate their environmental and social management system effectiveness to investors, customers, and other stakeholders.
Clients are increasingly being drawn to EcoVadis for its pragmatic approach and an easy-to-use portal for submission. EcoVadis’ comprehensive assessments appeal to companies of different sizes. It has environmental, social, and ethical risks insights, benchmarking capabilities, actionable insights, and enables transparency in supply chains. These factors not only enhance clients’ sustainability practices but also bolster their appeal to trading partners, investors and consumers who favour companies with robust ESG records. In a recent survey, investors ranked EcoVadis in fourth place for its quality amongst other sustainability ratings providers. In this same survey, EcoVadis also comes in sixth place when ranked by corporates for its usefulness and quality.
SLR plays a vital role in helping businesses keep up with the ever-evolving ESG reporting landscape. We have a track record of helping our clients improve and better understand their EcoVadis scores. Great attention to detail is required in an EcoVadis Assessment to ensure a thorough submission. Through gap analysis, we can help you identify the gaps in your submission. We can engage with data owners to improve the submission process and formulate targeted improvement strategies. SLR can support you to the extent you require and depending on the stage you are at in the assessment process.
SLR supports clients across multiple sectors such as professional services, manufacturing, legal and financial services, construction, and engineering sectors. EcoVadis can be used as a valuable tool to streamline measurement and reporting processes. This support goes beyond demonstrating sustainability excellence to internal and external stakeholders. SLR can help you use EcoVadis as a valuable tool to streamline measurement and reporting processes, integrating resources, and enhancing sustainability performance within the business and across other indices. To learn more about this support, visit ESG Reporting & Disclosure or get in touch.