SustainAbility has launched this research as stakeholders of all kinds – investors, consumers, and employees – are increasingly relying on third-party ratings of corporate sustainability performance to help inform their decisions to invest, purchase, and work. Companies are also beginning to rely on such ratings to gauge and validate their own sustainability efforts, with some companies even linking management compensation to external ratings. These ratings, therefore, must be robust, accurate, and credible.
In the first phase of research – the white paper for which is available on www.sustainability.com – SustainAbility explored the evolution of the ratings agenda over the last decade, and identified key trends and challenges in the ratings space, for example a lack of transparency, the difficulty in rating companies across sectors, a lack of focus on the economic leg of the triple bottom line, and whether ratings are helping to drive us to a sustainable future.
We now move forward with the remainder of Rate the Raters. In phase two (May to July 2010), we will map the current universe of sustainability ratings, capturing various data points (e.g. research source, issue focus, disclosure of methodology) and identifying patterns and trends across the ratings. In phase three (July to October 2010), we will dive deep into a select number of ratings to better understand how they approach the evaluation of sustainability performance. We will seek to understand how these ratings deal with the challenges identified in our phase one research, and we will also look for examples of good practice that may be applied elsewhere. Lastly, in phase four (November to December 2010) we will explore the future of sustainability ratings and how they need to evolve to meet the challenges and needs of ratings producers and users.
About SustainAbility: Established in 1987, SustainAbility is a strategy consultancy and think tank working with senior corporate decision makers to achieve transformative leadership on the sustainability agenda. We offer a range of services and undertake advocacy in order to create financial value at the same time as addressing environmental, social and governance issues in an integrated manner.