… often fail to identify why investors are asking for the information and whether / how they will actually use this.
Frameworks can be divided into:
* Single-user frameworks - such as those specified by individual research providers - such as Sustainalytics or ISS-ESG
* Multi-user frameworks - such as those developed by data specialists who aim to channel data towards others - such as CDP, Bloomberg or Factst
* Open-source frameworks - such as those intended to be used by multiple users - such as GRI or SASB
Over time, it seems likely that companies will migrate from focusing on 'single-user' frameworks towards 'multi-user' frameworks and 'open-source frameworks'.
In respect of the latter, there are signs that the framework being developed by SASB is gaining traction - largely as it is being adopted by some of the larger passive investors.
Importantly, however, companies should always remember that individual active investors are likely to be most interested in information that is not captured by frameworks - as this is where investment advantage is likely to lie.