There are multiple drivers for the growth in environmental, social and governance (ESG) tracking. Demand has been created by regulatory changes such as the introduction of TCFD (Taskforce on Climate-related Financial Disclosure) and SFDR (Sustainable Finance Disclosure Regulation) in the EU, with the potential for further carbon reporting standards going forwards.

In addition, there are a growing number of investors and asset managers that see ESG as a key performance indicator and who want greater clarity on ESG scoring. Availability of green financing is one incentive to get this right, whether that is funds with an explicit sustainability mandate or debt ratchets dependent on ESG metrics.

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