The Corporate Sustainability Assessment (CSA) by S&P Global further extended its coverage in 2022 by assessing more than 13,000 companies. By doing so, it has reviewed >550,000 documents and >25 million datapoints for the entire 2022 assessment. Around half of the companies assessed stem from Asia Pacific (6,924), followed by North America (3,628) and Europe (2,716). In Latin America and Africa, less than 1,000 companies were assessed.
The highest active participation rate in the CSA was in Latin America however, where 47% of invited companies filled out the CSA questionnaire. This is followed by Europe (22%) and Africa (20%). North America and Asia Pacific have the lowest participation rate, at 16%. Overall, over 2,500 companies have actively participated in the 2022 CSA, which is an increase of 34% compared to the previous year.
S&P Global also keeps its questionnaire up to date by revising the methodology of a number of questions every year. In 2022 for example, a number of questions on the Climate Strategy criterion were added, in order to evaluate how companies are incorporating the Task Force for Climate-Related Financial Disclosures (TCFD) framework. To see how companies score on this criterion, as well as five other criteria selected by S&P Global for the webcast, download our summary document.
S&P Global is in the process of preparing double materiality matrices for all industries that it evaluates in its assessment. The methodology of determining double materiality will be forward looking, meaning that actual and potential impacts over the short-, medium- and long-term are considered when identifying the material topics.
The materiality matrices furthermore incorporate company feedback received through the comments section of the CSA, as well as the CSA Helpline. S&P Global also aims to align its methodology to internationally recognized standards, such as the European Sustainability Reporting Standards (ESRS) and GRI Standards. At last, S&P Global also reaches out to investors, to inquire what aspects are most material to them.
The purpose of this exercise is to show which sustainability topics are most important for certain industries, when considering both the impacts of the company on society and the environment, as well as whether the sustainability topic can significantly affect company’s value drivers.
Furthermore, S&P Global aims to use this to evaluate 25 core subjects (accounting for variations between industries) on how they affect company’s unique value drivers. Examples of value drivers include sales growth, capital expenditure and cost of capital. This will allow investors to better understand how well companies are managing the ESG risks impacting value drivers. The double materiality matrices will be available on the S&P Global website from January 2023 onwards.
During the Q&A at the end of the webcast, S&P Global granted some insights into some of next year’s methodology changes. There are three topics where S&P Global is planning to make major revisions. However, it is important to consider that there might be more changes and the ones below are also not finalized yet.
The detailed methodology changes to the 2023 Corporate Sustainability Assessment will be announced towards the end of March. If you would like to receive a summary of the main methodology changes as soon as they are announced, send an email to Marizel Vorster at firstname.lastname@example.org.
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