CSR and ESG:

A Practical Guide to
Social Impact Reporting
There is increasing pressure on companies
to deliver comprehensive Environmental,
Social, and Governance (ESG) reporting,
but little standardized guidance on how
to do it. Done correctly, ESG reporting
can help corporate social responsibility (CSR)
professionals to demonstrate the
social and business value their efforts
are generating as well as strengthen their
programs. However, navigating unclear and
inconsistent requirements, especially with
an anti-ESG backdrop, can be challenging.

This guide offers practical tips, dozens of

resources, and an easy-to-use framework
for CSR professionals looking to make
the most of this opportunity to create new,
or strengthen existing, CSR and ESG
reporting efforts. A

True Impact page 2

Contents 20

Establishing Credibility in ESG

ESG Auditing and Assurance

21 Social Metrics: Why Outcomes Drive

Impact, Generate Change, and
Appease Your Investors

22 Investment-Grade ESG Performance

Data: A Competitive Advantage

23 Leveraging Results:
Using Impact Data to Enhance
4 Introduction Reporting, Marketing,
5 CSR vs. ESG and Communications

6 How is the reporting different? 24 Determine Audience and Appropriate

Context
7 As ESG rises in popularity, what do
these changes mean for corporate Distribute Impact Data and Stories
citizenship professionals ? Internally and Externally

Should I be concerned about ESG Communications and ESG Backlash

backlash? How are other companies 26 Conclusion
addressing this?

10 Existing ESG Frameworks

11 Capturing the “S” in ESG Now do this!

12 What to Measure:
Developing a Strategy Reading through a 28-page report
to Capture the “S” seem a bit much for right now? No
13 Materiality Assessment: What actually problem. We’ve designed this report to
matters to our stakeholders? be skimmable and have even included
Now do this! boxes to kickstart your
14 Baseline: So, where are we now? efforts. Let’s get started!

15 Goals: Where do we want to go?

16 Actionable Strategy: What’s the best

way to get there?

18 Evaluating Impact:
The Role of Transparency, Credibility,
and Data Quality

19 Adding ESG-Level Transparency

to CSR Data

True Impact Contents page 3

 This guide will provide value to:

■ CSR department leaders who need to

align their social impact initiatives with
clear business value for the company

Introduction ■ CSR professionals struggling to

substantiate their work with the
quantitative metrics required of
ESG reporting

■ Corporate ESG leaders who need to

Sustainability, corporate social integrate material social issues into
responsibility (CSR), and ESG have broader business strategies
been around for decades, but increased
regulation, interest, and now scrutiny and ■ Company leadership and board members
backlash, have recently brought these who need to address ESG risks and
issues to the forefront. Conversations opportunities to shareholders, especially
about ESG have extended far beyond the in an anti-ESG environment
boardroom, with companies, investors, and
the general public expressing intrigue and
skepticism alike.

But, for corporate citizenship professionals,

just how different are CSR and ESG reporting?
What does this mean for your work in
social impact? Throughout all the ESG
data collection, auditing, and committee
coordination madness, are there any benefits
for you and your team?

The rise in ESG reporting is accompanied

by exciting opportunities and undeniable
challenges for leaders in the corporate
citizenship and philanthropy space. With the
information, resources, and practical tips in
this report, CSR professionals will be able to
better demonstrate the value of their social
impact programming, generate insights
to drive improvement, and strategically
communicate the value of their hard work—
even in the face of backlash.

True Impact introduction page 4

 When it comes to corporate citizenship,
how are CSR and ESG different?

While both refer to a company’s commitment

to responsible business practices, there are

CSR vs. ESG

key differences in the scope of their work,
integration into the company, stakeholder
engagement, and performance metrics.

CSR traditionally focuses on a company’s

ethical, philanthropic, and community-
based activities. These activities are often
voluntary and can be more tangential to
the company’s core business. ESG, on the
other hand, encompasses a broader range
of issues, including environmental impact,
social practices, and governance, which are
linked to a company’s core business and
financial performance.

True Impact CSR vs. ESG page 5

While CSR and citizenship activities How is the reporting different?
mainly fall under the social arm, they
also play a supporting role in all aspects CSR Reporting
of a comprehensive ESG strategy.
Generally speaking, a CSR report (or
sustainability or impact report) focuses
on a company’s corporate citizenship,
What role does citizenship philanthropy, and employee engagement
play in ESG? programs. These reports often emphasize
Environmental narratives, interspersed with ad hoc metrics,
to highlight the company’s accomplishments
company: emerging over the past year.
employees: emerging
investors: none ESG Reporting
customers and partners: none
ESG reports focus on the performance of the
communities: emerging
non-financial aspects of a company, such as
regulators: none
community engagement, waste management
society at large: emerging
practices, supply chain management, board
Social oversight, and ethical business practices.
Quantitative metrics play an essential role in
company: leading expressing how the company is mitigating
employees: leading risk and creating value over time. Combining
investors: partnering narratives and data, ESG reporting offers a
customers and partners: partnering measurable and holistic view of the business.
communities: leading This also means that both progress and
regulators: partnering shortcomings are often addressed in these
society at large: leading reports, not just the annual highlights.
Governance

company: none
employees: none
investors: none
customers and partners: none
communities: leading
regulators: none
society at large: none

True Impact CSR vs. ESG page 6

As ESG rises in popularity, what do Should I be concerned about ESG
these changes mean for corporate backlash? How are other companies
citizenship professionals? addressing this?
Corporate social responsibility has The rise in ESG reporting has also coincided
historically been seen as a “nice-to-have” with an increase in backlash, particularly
activity, whereas ESG is increasingly being in the US. According to The Conference
viewed as essential for leadership, investors, Board, there are three main types of ESG
shareholders, regulatory bodies, and even backlash: skepticism, those who are wary
customers and employees. of the proposed benefits of ESG investment
funds; philosophical opposition, people who
The buzz over ESG is opening the door to are concerned about shareholder value and
an exciting mindset shift for corporate generally opposed to ESG regulations; and
citizenship leaders. Your work is part of opportunism, those who are against “woke
the “S” in the ESG equation, illuminating capitalism” and certain social issues.
the importance of your work to the overall
long-term health of the company. This is an While making the case for the relevance
opportunity to highlight the role CSR plays of social issues in business is not new, the
in attracting new business and partnership politics, emotions, and public discourse
opportunities; reducing regulatory burden; surrounding the “S” are playing a greater role
generating easier access to capital; and in the ESG conversation at many companies.
improving brand reputation, sales, and Although 49% of the companies surveyed
customer loyalty. by The Conference Board have experienced
some sort of ESG backlash—either against
Increasingly, corporate citizenship their company, their industry, or a general
leaders tell us that the transition to ESG backlash in their state, 71% of US CEOs
has brought a newfound regard for their and 64% of European CEOs do not plan on
work at all levels of the business. With the cutting back their ESG investments. 1
help of comprehensive social impact data,
corporate citizenship has become an active In this increasingly polarized environment,
component in creating value for the business companies need to be thoughtful about not
with customers, potential partnerships, board only their ESG goals but their messaging and
members, and company leadership. communications strategies. Many experts see
this discourse as an opportunity to educate
However, this increase in prominence also the public, engage specific stakeholders,
brings new scrutiny, which CSR professionals strengthen the link between ESG and value
should be prepared to meet with strong and creation, and foster conversation with people
compelling evidence and documentation. on both sides of the debate.

True Impact CSR vs. ESG page 7

Comparing CSR and ESG:
A Brief Overview

What is it? CSR: Corporate ESG: Environmental, Social,

Social Responsibility and Governance

So the “S” Yep. Also, yep.

is the same
in both?

What is it? The business’ impact on The non-financial aspects

society inside and outside of a company’s strategy
the company and performance

What does CSR shows how a company E Environmental:

that mean, is operating in ways that Encompasses how a company
exactly? contribute positively to society: is exposed to and manages
corporate philanthropy; risks and opportunities related
employee engagement; to the environment.
diversity, equity, inclusion, and
belonging (DEIB); supply chain
management; sustainability; S Social: Social and
and community investment. human capital topics and
practices, particularly
CSR programs can include: with the community and its
employees. Includes
■ volunteerism corporate philanthropy,
and philanthropy DEIB, product safety, working
■ ethical labor practices conditions, human rights
■ education and training practices, employee
■ employee health relations, labor practices of
and wellness suppliers, and more.
■ community engagement
■ environmental G Governance: The company’s
sustainability corporate governance,
■ consumer education including executive
and safety compensation, diversity of the
board, and anti-bribery and
corruption practices.

True Impact CSR vs. ESG page 8

 What is it CSR: Corporate ESG: Environmental, Social,
again? Social Responsibility and Governance

What There may be a corporate Involves ESG steering

departments social responsibility committee across disparate
are usually department. If not, usually departments, such as human
involved? a version of the following: resources, legal, finance,
corporate citizenship, corporate citizenship,
corporate philanthropy, sustainability, construction
community engagement, or management and property
community relations. management, operations, etc.

How is this Historically, CSR was often ESG is integrated throughout

integrated viewed as a “nice-to-have” a company’s strategy and
into the activity separate from increasingly viewed as a core
company? the revenue-generating driver of business value.
departments of the company.
This is changing now
with clearer overlap between
business and social
value creation.

True Impact CSR vs. ESG page 9

Now, let’s discuss a few things to keep in If you’re based at a business in the European
mind while adapting your CSR reporting to Union with over 250 employees, you have
ESG standards. even more to think about. Your company is
now subject to the Corporate Sustainability
Existing ESG Frameworks Reporting Directive (CSRD), meaning that
you are required to file ESG reporting under
98% of the companies surveyed by Chief the still-evolving (as of April 2023) European
Executives for Corporate Purpose (CECP)2 are Sustainability Reporting Standards (ESRS)
using some form of voluntary standards for drafted by the European Financial Reporting
ESG reporting. While these are some of the Advisory Group (EFRAG). Companies will
most prominent frameworks used today, there need to apply the new rules in the 2024 fiscal
are no set standards for the sector as a whole: year, for reports published in 2025.
■ Sustainability Accounting Standards At the UN COP26 in November 2021, the
Board (SASB) International Financial Reporting Standards
(IFRS) announced the creation of the
■ Global Reporting Initiative (GRI)
International Sustainability Standards
■ Climate Disclosure Standards Board Board (ISSB) to develop a global baseline
(CDSB) for sustainability disclosures focused
on investors and financial markets. US
■ Carbon Disclosure Project (now only companies with a significant presence in
referred to as CDP) Europe or Asia will probably need to comply
with the disclosure standards in these
■ Task Force on Climate-Related Financial
regions, even if the US does not require them.
Disclosures (TCFD)

■ International Integrated Reporting

Council (IIRC)

■ United Nations Sustainable

Development Goals (UN SDGs)

Now do this!

Check with your legal, accounting, or

finance departments to see which ESG
frameworks are most relevant to your
company and its goals.

If none have been chosen yet,

bookmark What are ESG Frameworks?
by IBM for a list of factors to consider
when selecting one.

True Impact CSR vs. ESG page 10

Capturing the “S” in ESG But once your team has established an
approach to generating standardized
Quantifying something that has traditionally outcome metrics, you have what you need to
been captured with narratives and both prove and improve your social impact.
storytelling can be challenging. According Framing CSR as a crucial part of ESG
to the aforementioned survey by CECP, justifies community commitments that may
54% of companies believe the social have previously been underappreciated and
factors of ESG are the most complex to vulnerable to cuts or underfunding.
accurately measure:

■ Compared to financial and environmental

data, the lack of sector-wide standards
for reporting social data can make it more
difficult to know what data to collect and
how, even for auditors.

■ Gathering data from nonprofit

organizations about their social impacts
presents its own logistical challenges,
both in guiding them on what data to
report and enforcing standardization
among partners.

■ For large companies with expansive

CSR portfolios, this can be a laborious
process. Smaller organizations may lack
the capacity to generate comprehensive
data about their programs, resulting in
inconsistent data quality and a tendency
to highlight larger nonprofits at the
expense of grassroots organizations.

■ Inconsistencies due to the lack of reporting

standards and varying data quality among
nonprofits can confuse internal auditors.
This may result in companies limiting
their citizenship metrics to inputs and
outputs, such as dollars donated or hours
spent volunteering.

True Impact CSR vs. ESG page 11

 It takes a village to build an ESG strategy.
While this applies to all aspects of ESG, the
“S” is unique in that everyone connected to
the company can play a role in its success.

What to Measure:
A comprehensive ESG strategy can set the
foundation for short-term policies and long-
term success for your company. This involves
Developing a Strategy determining your stakeholders’ key priorities,
benchmarking against your peers and

to Capture the “S” competitors, establishing your company’s

goals, and executing a strategy while
remaining accountable to your stakeholders.

This takes time, but done right, it can spark

insights that go beyond your ESG reporting to
generate real change for your business.

True Impact What to Measure page 12

Materiality Assessment:
Materiality Assessment Guides
What actually matters to
our stakeholders? These guides explain materiality for
the most common ESG reporting
A myriad of issues are fighting for our frameworks. Someone on your team
attention. Companies need to prioritize the has probably downloaded a couple of
issues with the greatest impact on their these already. If not, that person may
business, society, and their stakeholders. need to be you.
This high-level strategic information is
generated in a materiality assessment, ■ Exploring Materiality by the
or materiality map. Sustainability Accounting
An ESG materiality assessment Standards Board (SASB)
involves identifying and analyzing the
environmental, social, and governance ■ How to Use the GRI Standards by
risks and opportunities that may affect your the Global Reporting Initiative (GRI)
company’s operations, reputation, and brand
value. The assessment takes into account ■ Materiality in Integrated Reporting
the perspectives and expectations of the by the International Integrated
company’s stakeholders. Reporting Council (IIRC)

■ CDSB Framework by the Climate

Disclosure Standards Board (CDSB)
Now do this!
■ Reporting Climate-Related
Financial Information: Critical
Email a colleague to see if the company Introductory Materials by the Task
has a materiality assessment. If yes, Force on Climate-Related Financial
get a copy. If not, The Essentials of Disclosures (TCFD)
Materiality Assessment by KPMG
offers a step-by-step guide to prepare ■ TCFD Implementation Guide by the
your team for the materiality process. SASB and CDSB

■ Sustainable Development
Goals Disclosure (SDGD)
Recommendations by the
International Federation of
Accountants

■ Industry Guide to the SDGs

by the SASB

True Impact What to Measure page 13

Stakeholder Engagement,
ESG Committees, & Leadership Now do this!
Designing a materiality assessment is a
deeply collaborative process. Engaging the
right stakeholders—e.g., customers, company Download this template for a list
leaders, board members, employees, vendors, of materiality questions to ask your
suppliers, partners, investors—will increase stakeholders.
the likelihood that your results are accurate
and assure your stakeholders that you’re on
the right path. Baseline:
Cross-team internal collaboration is So, where are we now?
another key to establishing an ESG strategy
Not knowing where you’ve started means
that will generate value for the entire
you can’t adequately track your progress
company. This may require collaboration
or put your goals in context. Once you have
with human resources, corporate
a comprehensive idea of where you stand,
communications, finance and accounting,
both as a company and as an industry, you
marketing, investor relations, legal counsel,
can start drafting a plan to uncover missed
public affairs, supply chain and operations,
opportunities, increase operational efficiency,
various business units, and more, especially
mitigate your company’s risk, and, ultimately,
since corporate citizenship can serve as a
reach your objectives.
liaison to all of these departments.3

The leader of the ESG committee, ideally, Benchmarking: How are we doing
shouldn’t be more than one degree away
from the CEO. Gaining leadership buy-in
compared to our competitors?
is one of the top hurdles when it comes to Benchmarking is an essential step in building
developing and carrying out an ESG strategy; 4 your ESG and corporate citizenship strategies.
companies with this level of access to If no man is an island, no company can draft
company leadership are more likely to be an ESG strategy without considering its
successful in their ESG efforts. competitors, vendors, and the industry at
large. At True Impact, we offer social impact
In the end, the goal is to establish the social benchmarking data and insights across
issues that 1) matter most to the company industries and cause areas, such as STEM,
and its stakeholders and 2) present the nutrition, gender equity, racial equity and
greatest risks and opportunities over the inclusion, health and wellness, educational
long term. Once you figure out this list of access, economic development, disaster
priorities, then you can establish goals, relief, and a myriad of others.
measurement, and management processes
to generate value and drive impact for the Here are some benchmarking best practices
company and society. to help you figure out where your company
currently stands:

■ Evaluate the ESG reporting standards and

frameworks used in your industry.

True Impact What to Measure page 14

■ Assess your competitors’, peers’, and Similarly, you can start with a budget and
vendors’ ESG strategies, social cause build out your initiatives from there. When
areas, CSR programs, and results. your company’s social and business goals
are aligned, your team can amplify its
■ Follow trends in the market and in the ESG impact by designing a practical plan to
ecosystem, especially if your company has strategically invest in the focus areas that
a presence in European or Asian markets. matter most.
Since the US is behind in most areas
of ESG, your company may be subject to
more stringent international standards.
Now do this!
Comprehensive benchmarking will give you
more data to solidify your material issues, Schedule a free strategic planning
risks, and opportunities, as well as highlight consultation with True Impact to
the business case for ESG. At the very make sure your KPIs are in line with
least, uncovering the gaps between your your business strategy and CSR
company and the market can help you protect measurement goals.
against underperformance and putting the
company at risk. Once you’ve established a
baseline, you can focus on specific goals and
act strategically. Longer-term goals involve the ways in which
ESG is incorporated into your business
Goals: strategy to create value for the company and
society. A strong ESG proposition can lead to
Where do we want to go? top-line growth, cost reductions, productivity
uplift, asset optimization, and a reduction in
Now that you have a baseline, you can
regulatory and legal interventions.5
start to craft a plan to achieve your short-
and long-term goals. “Organizations must also integrate ESG
considerations in a way that drives long-term
If your company is completely new to ESG,
value creation. So, let’s start getting tactical:
your most immediate goals may focus on
How can your organization embrace ESG-
getting your ESG materiality map, stakeholder
driven business transformation to turn risk
assessments, committee, and basic reporting
into opportunity? And how can you create
up and running. The goals and strategy
reporting that reflects not only how your
surrounding what you’d like to accomplish
ESG efforts connect with each other and
with ESG might come a bit later. Can’t put the
your finances, but also how they connect with
cart before the horse, you know.
value creation?”
If your company is trying to establish
Deloitte, How to Audit ESG Risk
medium-term goals (3 to 5 years), you may
and Reporting 6
want to figure out what impact you’d like to
have and work backwards from that. These
goals often include recognition in your
industry or in the market, such as a specific
ESG rating score (e.g., ISS, MSCI), appearance
on the Dow sustainability index, etc.

True Impact What to Measure page 15

Actionable Strategy: Communicate with Stakeholders Regularly
What’s the best way to get there? Ongoing dialogue with your stakeholders,
especially your customers and employees,
While there are as many strategies as there will help you stay updated about their
are companies, we have a few tips to help your personal needs, professional development
company use its unique strengths to reach goals, social cause interests, and desire to
success. A clearly defined strategy will improve the community.
not only help your company reach its ESG
goals, but it will also mitigate the Some of the tools to successfully
risk of your company being targeted in do this include:
an anti-ESG environment.
■ Using several channels for
Align Your Company’s Strategy communication: A mix of email, social
with Its Specific Value Proposition media, newsletters, webinars, and/or
in-person meetings will help you reach a
Leveraging your company’s unique wider audience.
capabilities—such as its products and
services talent, industry knowledge, ■ Developing a stakeholder engagement
international locations, or manufacturing plan: This should include your approach
plants—will help ESG become ingrained into to reaching different stakeholder groups,
its business strategy. the channels and methods you’ll use to
communicate with them, the frequency of
Try answering this question to better
engagement, and topics of discussion.
understand your unique value proposition:
What are the things that my company is
■ Providing opportunities for feedback:
uniquely positioned to do in order to help
Surveys, focus groups, and other forms
our stakeholders and the causes and
of feedback can help your stakeholders
communities we care most about?
have a voice.
For example, Deloitte, a professional services
company, focuses on pro bono and skills- ■ Following up on your ESG commitments:
based volunteering to achieve lasting social Reporting on your progress will let
impact. The PepsiCo Foundation uses its stakeholders know that you’re committed
logistical know-how and resources for Food to continuous improvement.
for Good, its global platform to promote food
security. Lowe’s home improvement and
hardware stores use local store volunteers, Encourage Employee Engagement
grants, and in-kind donations to improve and Engaged employees are more likely to be
renovate community spaces. happier, healthier, and more satisfied with
their work. From employee skill development
to nonprofit capacity building, encouraging
employees to engage in volunteering,
pro bono service, and matching gifts will
pay dividends to the company and the
surrounding community.

True Impact What to Measure page 16

Here are a few more tactics to promote Recommended Resources
employee involvement in your ESG goals:
Social-Impact Efforts that Create Real
■ Create a culture of transparency: Value by the Harvard Business Review
Encourage open communication by
sharing the company’s ESG performance, How Materiality can Help Reporting Meet
goals, and challenges with the team. the Demands of Investors by Ernst & Young

■ Provide opportunities for training and Balancing Your Materiality Assessment:

development: Offer training to employees How to Move Beyond the Matrix by Deloitte
to help them build skills related to ESG (for companies using the GRI and/or ESRS)
issues, such as community engagement ESG Oversight: The Corporate Director’s
practices and ethical decision making. Guide by PwC

■ Involve employees in decision making:

Involvement in decisions related to ESG
issues, such as developing community
engagement initiatives or selecting
social impact projects to support, will
help employees feel more invested in the
company’s goals.

What Investors Are Saying

94% of US institutional investors

proactively approach reputable
activists with ideas for fostering
change in companies in which they’re
investing or thinking about investing.7

True Impact What to Measure page 17

 Some of the pushback ESG has received
revolves around transparency. No one
wants to air their dirty laundry or shine a
light on their weak spots. However, not
addressing ESG weaknesses can allow

Evaluating Impact: them to fester, creating greater regulatory

and reputational risk. Underneath those

The Role of
soiled clothes is where compliance issues,
operational setbacks, and PR catastrophes
tend to lie.
Transparency, When a company is managing its ESG

Credibility,
performance well, it can be an indicator of
good overall corporate management, as well.
Transparency breeds trust.

and Data Quality

True Impact Evaluating Impact page 18

 hours or increased the reach of your (virtual or
How much risk hybrid) community engagement initiatives.
can ESG performance predict? Perhaps layoffs decreased the diversity of
your team. Maybe the actual results from your
A study by the Bank of America Merrill CSR programs are just different from what you
Lynch Global Research 8 found that ESG had expected.
performance often correlates with finan-
Data variance is part of the full picture of your
cial volatility for companies. For example,
ESG performance. It can show trends in social
15 of the 17 S&P 500 companies that filed
impact, such as those affected by the pan-
for bankruptcy between 2005 and 2015
demic, as well as best practices that could be
had low ESG scores five years prior.
shared with other programs. These metrics
go beyond the social impact highlights in
CSR reporting to get to the year-over-year
Adding ESG-Level data stakeholders need to see.

Transparency to CSR Data Explain What Changes

the Company Plans on Making
Both ESG supporters and critics are to Improve Results
concerned about misrepresented claims in
ESG reporting. Shareholders and customers Stakeholders need to see the data and
alike are becoming attuned to the vague policies in place to turn good intentions into
language, buzzwords, and lack of relevant lasting change for the business. Not every
data used as cover for greenwashing and material issue deserves a place in your ESG
lip service. report. But if an issue is important enough to
make it to the final list, share your plans for
Here are some transparency shifts to keep in reaching the goals that matter most.
mind when translating your CSR efforts into
an ESG report:

Align Impact Data with What Investors Are Saying

Your Chosen ESG Frameworks
86% of US institutional investors believe
ESG disclosures require information to
companies exaggerate their ESG prog-
evaluate how your company is managing
ress, and 91% are specifically looking for
non-financial risks and opportunities,
instances when companies fail to deliver
working towards key goals, and performing
on their ESG promises and disclosure.9
compared to other companies. This gives
you the chance to show the importance of
your corporate citizenship efforts to the
company at large. Recommended Resources

Transparency and Impact: The Essential

Highlight Year-Over-Year Progress Towards the
Principles of ESG by S&P Global
Company’s Social Goals
Financial Performance of ESG Integration
ESG reporting often includes progress over
in US Investing by the UN Principles for
time…for better or for worse. Maybe COVID-19
Responsible Investment
decreased your company’s volunteering

True Impact Evaluating Impact page 19

Establishing Being able to stand behind your data is vital in
ESG reporting. Not only are more eyes than

Credibility
ever on ESG data, but those eyes are looking
for unsubstantiated claims.

in ESG
Investors, shareholders, and stakeholders
alike need data they can trust. A data
collection and analysis process that can help
“ESG can retain the attention it has garnered your team review, validate, and demonstrate
over the past two years if companies your results—not just social impact promises
and investors better match their public or mission statements—will put your
commitments with operational rigor. Skeptics company at an advantage.
will undoubtedly remain, but ESG can become
a powerful force for change if stakeholders ESG Auditing and Assurance
make it so.”
Internal ESG auditing and external ESG
Nick Cericola, assurance often stand between ESG data
Vice President, Insights and the report itself. Since any metrics that
NationSwell 10 cannot be verified will most likely be discarded
by external auditors, a lot of companies don’t
bother assuring their metrics at all.

While 95% of companies reported some

ESG information in 2021, only about 65%
obtained some level of assurance on their
metrics. 11 This can be a mistake, as a lack
of auditing and assurance will lessen the
confidence investors have in your reporting.

With comprehensive, validated social

metrics, your ESG reporting can tell a
more compelling story of your impact while
giving auditors and assurance professionals
confidence in your data.

Now do this!

Bookmark The Path to ESG Reporting

and Attestation Readiness by BDO for
a comprehensive guide to working with
auditing and assurance providers.

True Impact Evaluating Impact page 20

Social Metrics:
Why Outcomes Drive Impact, Now do this!
Generate Change,
and Appease Your Investors Read Inputs, Outputs, and Outcomes
Many corporate citizenship departments in CSR for a guide on using CSR
focus on inputs (e.g., dollars donated to metrics to drive impact and generate
social causes), outputs (e.g., meals served lasting change.
or people reached), and ESG-related plans
and policies instead of the outcomes of their
programs (e.g., lives improved). These process
metrics are straightforward, easy to measure,
and can be easily traced for auditing and
assurance purposes.

However, reporting only on inputs and

outputs to demonstrated corporate social
impact is like sharing only expenses
or inventory levels to demonstrate a
company's financial health. The numbers
are important, but they alone can’t tell you
whether a company is profitable or headed
towards bankruptcy.

According to Forbes 12, investors are

starting to notice a lack of meaningful data
in ESG reporting:

“On accuracy, ESG data is typically more

qualitative than quantitative. Furthermore,
a disproportionate focus on ESG inputs
(e.g., ESG-aligned policies and strategies
implemented) as opposed to verifiable
outcomes (e.g., the volume of carbon
emissions reduced or the number of
product inputs recycled) skew data away
from what’s most useful.”

Companies that measure outcomes are at

an advantage both in their ESG reporting
and their citizenship work. True Impact
can take your CSR programs from the “good
intentions” of inputs and outputs to validated
outcomes that can speak to your impact
in as little as three months.

True Impact Evaluating Impact page 21

Investment-Grade ESG ■ Relevant: It is relevant to the company’s
material issues, helping investors
Performance Data: understand the associated risks
A Competitive Advantage and opportunities.

According to a Benchmark survey of 770

investment decision-makers13, 85% of
investors consider investment-grade Now do this!
ESG data to be more important than
other company data when researching
investments. Unfortunately, only 64% believe Schedule a conversation with True
that Fortune 500 companies are meeting Impact for more information about
these standards. getting validated social impact data
for your grants, volunteerism, and
But how does investment-grade data differ other philanthropic and community
from the rest? We’ve compiled a list of some of investments that can stand up to
its characteristics: scrutiny for your ESG reporting.
■ Accurate: Data goes through a
documented approval process to meet
the needs of company leadership. It’s
reliable and based on information from What Investors Are Saying
reputable sources.
94% of investors claim they’re more
■ Auditable: Data has a clear paper trail likely to invest in companies that
that can be verified by a third party. This generate, use, and report investment-
audit trail needs to show which exact grade ESG performance data.14
data point was modified when, by whom,
and based on what evidence, information,
or measurement.
Recommended Resources
■ Consistent: It is consistent in terms of
ESG Assurance: A Competitive
methodology and data collection, making
Differentiator by BDO
it easier for investors to compare and
analyze different investments. How to Audit ESG Risk and Reporting
by Deloitte
■ Comprehensive: Covers a broad range of
ESG factors, allowing investors to assess a
company’s overall ESG performance.

■ Timely: Data collection should be up-to-

date and reflect the current performance
of the company.

■ Automated: Data collection is drawn from

systems of record. Manual data collection
is minimized, if not completely eliminated,
to increase data accuracy.

True Impact Evaluating Impact page 22

 “But how much does the public truly care about
ESG? … We found that 83% of consumers
think companies should be actively shaping
ESG best practices and 86% of employees
prefer to support or work for companies that

Leveraging Results: care about the same issues they do. While
what consumers claim to care about and how

Using Impact Data

they behave do not always match perfectly,
these are still striking figures.”

to Enhance Reporting, Casey Herman,

US ESG Leader, Partner,

Marketing,
PwC US 15

and Communications

True Impact Leveraging Results page 23

Determine Audience
Where and How
and Appropriate Context to Share ESG Information
ESG can provide business value far internal external
beyond risk mitigation, access to capital,
and improved financial and operational impact social media
performance for a company. But before you dashboard
start sending your full ESG report far and wide sustainability/
to generate benefits for the company, figure board ESG reports
out what exactly your audience needs to see. presentations PR/news
ESG Reporting and Disclosures internal
A comprehensive account of your company’s newsletters
non-financial activity is a key document
for your shareholders, board members, summaries
and company leadership. This includes for use by peer
comprehensive metrics for your chosen departments
issues as well as narratives to humanize your (e.g., gov't affairs,
work and connect your company’s efforts to recruiting, HR)
value creation and risk mitigation.

ESG Highlights
Distribute Impact Data and Stories
Compelling narratives paired with important
metrics and key takeaways are great for
Internally and Externally
employees, customers, and your marketing
From board meetings to social media posts,
and communications team. This is less
your ESG impact data can be used to amplify
extensive than your full ESG report and
your company and its corporate citizenship.
disclosures, but it explains your company’s
Use your hard-earned results to create ad
impact in a relatable way.
campaigns, summary pieces, social media
Tailored Data Requests posts, thought leadership articles, internal
newsletters, and more.
The more impact data you have, and the
more validated outcomes you document, the Communications and ESG Backlash
more company leadership, board members,
and other internal stakeholders will want Your messaging and communications are
this information to generate value for the key in wading the ESG waters in the face of
business. These one-off data requests are opposition. While most companies have little
often about specific initiatives, beneficiaries, intention of scrapping their ESG efforts, many
geographical regions, intervention types, or are strategically approaching the matter
cause areas. to ensure the right messaging reaches the
right people.

True Impact Leveraging Results page 24

Addressing Current Backlash “No stories without numbers,
While Reducing Future Risk no numbers without stories.”
Companies that have experienced ESG Data to back up your narratives—and
backlash are considering a range of narratives to accompany your data—can
tactics to address the issue. Many of these transmit the significance of your impact
approaches are focused on two main areas: in a way that can deeply resonate with your
communications and ESG strategy. stakeholders. Incorporating impact data
into your messaging adds scale and
Communications can be used strategically legitimacy to your company’s efforts while
to convey your message to the right people the beneficiary stories behind the numbers
at the right time…or alternatively to get work add a human touch.
done without drawing too much attention to
yourself. Companies may consider adjusting Recommended Resources
the terminology around these matters,
such as changing “ESG” to “sustainability;” How Marketing Teams Can Tackle the
reducing external communications about Challenge that Is ESG by Forbes
ESG-related topics; or conversely, increasing Beware the Pitfalls of ESG Marketing
internal communications to some of the by New Narrative
company’s biggest advocates, to help
strengthen their understanding and support The ESG Marketing Model: 10 Business
of your company. Crucial Best Practices by Reaction Power

Understanding the “why” behind an ESG

strategy is key to navigating an anti-
ESG environment. Many companies are
increasingly focusing on the connection
between ESG and business value to make
sure stakeholders and shareholders can
see the big picture. Also, by joining forces
with other businesses with similar views
and concerns, companies can take advantage
of a network to share information and
get support.

Being Clear About Your “Why”

Companies releasing ESG reports are
encouraged to think about the “why” behind
their initiatives. This is where an extensive
materiality assessment aligned with your
stakeholders’ interests shows its true value.
This information can be used to explain the
link to value creation for your stakeholders,
which can improve your company’s reputation
while remaining accountable to their needs.

True Impact Leveraging Results page 25

 Citations
1
C-Suite Outlook 2023: On the Edge: Driving
Growth and Mitigating Risk Amid Extreme
Volatility by The Conference Board

Conclusion 2
Global Impact at Scale: 2022 Edition by Chief
Executives for Corporate Purpose (CECP)
3
Governance and Management of Corporate
Citizenship: Evolving Role and Relationships
of the Corporate Citizenship Function
ESG can be used to demonstrate the value by The Conference Board
of corporate citizenship to the health of 4
The Morningstar Sustainalytics Corporate
your company. But unclear procedures, ESG Survey Report 2022 by Sustainalytics
a lack of standardized, credible data, and the
fear of backlash can make it challenging. 5
Five Ways that ESG Creates Value by McKinsey

We hope this guide has given you ideas on 6

How to Audit ESG Risk and Reporting
tools, resources, strategies, and data you can by Deloitte
use to prove and improve your social impact,
and make greater strides towards achieving
7
Edelman Trust Barometer 2021: Institutional
your company's ESG goals. ■ Investors Trust Report by Edelman
8
Global ESG from A to Z: A Global Primer by
Bank of America Merrill Lynch
9
Edelman Trust Barometer 2021: Institutional
Investors Trust Report by Edelman
10
2022 ESG Trend Report: The State of Play
by NationSwell
11
Opportunity Knocks for Firms as ESG
Reporting, Assurance Levels Rise
by The Journal of Accountancy
12
Investing You Can Believe In: Investment-
Grade ESG Data by Forbes
13
2021 Benchmark ESG Survey: Investor
Attitudes on Company ESG Data
by Benchmark Digital Partners
14
2021 Benchmark ESG Survey: Investor
Attitudes on Company ESG Data
by Benchmark Digital Partners
15
How Much Does the Public Care about ESG?
by PwC

True Impact Conclusion page 26

 Review our list of “Now do this!” and other tips to get started

Download The Essentials of Materiality Learn more about how the True Impact
Assessment for a guide to prepare your platform can help your company get
team for the materiality process. evidence-based impact data in four steps:

Check with your legal, accounting, ■ Calculate all community investments

or finance departments to see which (grants, volunteerism, pro bono, etc.)
ESG frameworks are most relevant
to the company. Bookmark What are ■ Support your nonprofit partners
ESG Frameworks? If none have been as they report results
chosen yet.
■ Have True Impact‘s experts
Keep up with ESG regulatory compliance, review each submission
especially if your company has a
substantial presence in Europe or Asia. ■ Analyze results, share internally
and externally, and act on data
Make sure your KPIs are in line with your to improve impact
company’s business strategy and CSR
measurement goals.

Bookmark The Path to ESG Reporting

and Attestation Readiness for a
guide to working with auditing and
assurance providers.

Read Inputs, Outcomes, and Outputs in

CSR for a guide about driving real change
through your social impact metrics.

True Impact Conclusion page 27

 Schedule a conversation to see how
we can help substantiate the “S” in your
ESG reporting.
[Link]
sales@[Link]

©2023 True Impact, Inc. All rights reserved.