Understanding your stakeholders’ sustainability priorities helps form the foundation of your environmental, social and governance (ESG) reporting. Engaging your stakeholders on ESG matters is important because it pinpoints your organization’s material issues. This helps you align ESG initiatives with your business strategy.
We recently analyzed the ESG reporting of Canada’s top companies. We saw many organizations overlooking opportunities to disclose how they engage their stakeholders. Among the companies we reviewed:
- 38% don’t identify their internal and external stakeholders
- 42% don’t explain their process to identify material sustainability issues
Without these steps, companies can slip into the trap of reporting quantity over quality. So-called ESG data dumps make it hard for readers to understand an organization’s impact. It also leaves companies susceptible to accusations of greenwashing.
By contrast, explaining how you engage your stakeholders and act on their priorities shows you’re focusing your efforts where they make the most impact—a step that builds credibility and trust.