ESG Considerations and Questions for Boards
With investors and other stakeholders placing increased emphasis on ESG information, it is important for board members to understand key ESG risks and opportunities specific to their business purpose and core operations. These board members should also be involved in the governance and oversight of those topics and the metrics used to gauge progress.
Consider where the company is today regarding ESG reporting
Board members must consider where their company is today with respect to its ESG information.
Consider where the company wants to go with ESG reporting
ESG information is becoming more important to boards given increased investor attention on this topic. BlackRock CEO Larry Fink emphasized the important role of the board in ESG information by stating in his letter to CEOs, “Where we feel companies and boards are not producing effective sustainability disclosures or implementing frameworks for managing these issues, we will hold board members accountable.” Once the board has an understanding of the company’s current ESG reporting status, the next step is then to understand the strategic objectives of management’s ESG reporting and how to get there.