Voluntary frameworks – Who is who | ESG reporting standards

In this chapter we will map the ESG reporting ‘ecosystem’ (largely based on the WEF ESG Ecosystem Map), to help you to assess and understand which voluntary frameworks, standards and/or initiatives might be most appropriate for your firm’s ambitions for ESG reporting.

The below overview of reporting regimes, divided between generalist, climate and impact, is by no means exhaustive. Rather, it focuses on those organisations and bodies which we understand are most relevant to and are relied upon the most by Invest Europe members. This information was gathered through two member surveys in March and May/June 2022, and gives us a strong understanding of what private equity and venture capital fund managers and investors are using to report on ESG-related issues.

Reporting standards

Ifrs Box

International Sustainability Standards Board (ISSB)

Announced by the IFRS Foundation during the COP26 forum in Glasgow in November 2021, the ISSB intends to harmonise ESG standards by creating a global baseline for ESG reporting that is “focused on the needs of investors and financial markets”.

Global Reporting Initiative (GRI)

GRI is an independent, international organisation that helps businesses and other organisations take responsibility for their impacts, by providing them with a global common language to communicate those impacts (GRI Standards).

Generalist frameworks

UN Global Compact

The UN Global Compact is a voluntary initiative that supports companies to do business responsibly by aligning their strategies, policies and operations with the Ten Principles on Human Rights, Labour, Environment, and Anti-corruption, and to take strategic actions to advance broader societal goals, such as the UN SDGs.

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WEF Stakeholder Capitalism Metrics

The World Economic Forum (WEForum) Stakeholder Capitalism Metrics (SCM) encompass a set of common metrics and disclosures on non-financial factors for investors and other stakeholders.

Climate-focused reporting frameworks

Task Force on Climate-Related Financial Disclosures (TCFD)

The TCFD, set up by the Financial Stability Board (FSB), offers a set of climate-related ﬁnancial disclosure recommendations, structured around four thematic areas that represent core elements of how companies operate: governance, strategy, risk management, and metrics and targets.

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Taskforce on Nature-related Financial Disclosures (TNFD)

The TNFD aims to develop and deliver a risk management and disclosure framework for organisations to report and act on evolving nature-related risks.

Science Based Targets initiative (SBTi)

The Science Based Targets initiative promotes best practice in emissions reductions and net-zero targets in line with climate science, and provides technical assistance and expert resources to companies who set science-based targets.

CDP (formerly the Carbon Disclosure Project)

CDP supports companies, cities, states, and regions in measuring and managing environmental risks and opportunities, including those related to climate change, water security, forestry management, and other issues.

Impact-focused reporting regimes

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Global Impact Investing Network (GIIN IRIS)

The GIIN intends to support impact investors in maximising their positive effects on society and the environment and minimising the negative effects by incorporating social and environmental factors, or impact considerations, into their investment decisions alongside risk and return.

Impact Management Platform

Impact Management Platform

The Impact Management Platform (IMP) is a collaboration between leading providers of public good standards and guidance for managing sustainability impacts.

Impact Frontiers

Impact Frontiers

Together with the Impact Management Platform, Impact Frontiers has resulted out of the impact collaboration project with IMP. The focus of Impact Frontiers lies on learning about impact standards and techniques via modules and various resources provided on the platform.

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OPIM

The Operating Principles for Impact Management (OPIM) collate the best practices and approaches to impact management, which they then use to offer guidance to those struggling to do so effectively.

Coalitions and initiatives

Principles for Responsible Investment (PRI)

Launched in 2005, the UN Principles for Responsible Investment (PRI) is an investor initiative, which is supported by, though not part of, the United Nations. Now with 3,800 signatories, it advocates for six principles for responsible investing and relies on voluntary disclosures by members.

iCI

The Initiative Climat International (iCI) is a global initiative designed around facilitating the sharing of expertise and knowledge around climate change related best practice among its members.

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ESG Data Convergence Initiative (EDCI)

The ESG Data Convergence Initiative (EDCI) is a collaborative initiative between LPs and GPs, the aim of which is to enable comparative reporting around a set of ESG metrics that are jointly deemed as ‘core metrics’ by members of the project.

B Corp Box

B Corp

The B Corp movement is an independent non-profit initiative formed by an international network of organisations. Organisations are certified as ‘B Corporations’ if they meet a high standard of social and environmental performance.

Other private equity focused regimes

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ILPA DDQ

The ILPA DDQ 2.0 and Diversity Metrics Template intend to standardise the key areas of inquiry posed by investors during their diligence of managers and to provide a framework for ongoing monitoring of progress related to DEI.

Explore all sections of the guide

Th Getting Started2

Getting started

ESG throughout the investment life cycle Developing an ESG policy Assessing materiality

Th Reporting Template And Tools

Reporting template and tools

ESG reporting template ESG life cycle tool SFDR tools TCFD tools Timelines

Th Regulatory Mapping

Regulatory mapping

Introduction EU funds and fund managers EU investors EU portfolio companies UK TCFD Other national legislation

Th Mapping Of Voluntary Frameworks And Standards

Mapping of voluntary frameworks and standards

Definitions and distinctions Who is who Scope of information

Th Deep Dive For Vcs And Investors2

Deep dive for VCs and investors

ESG reporting from a VC perspective ESG reporting from an investor perspective

Th Additional Reading

Additional reading

Current market practice Glossary Appendices