ESG disclosure refers to the process in which enterprises, when conducting business activities, actively take into account various factors such as the environment, society, and governance, and publicly disclose this information to investors, consumers, and other stakeholders.
Regarding the scope of ESG factors, the environmental aspect includes whether enterprises strictly abide by environmental protection regulations, actively adopt renewable energy, and effectively reduce the emissions of wastewater and exhaust gas. The social dimension involves whether enterprises genuinely respect labor rights, human rights, and contribute to community development. From the governance perspective, it focuses on the standardization of enterprise operation and management, as well as compliance with regulatory laws and regulations.
By publicly disclosing ESG information, investors and other stakeholders can gain in - depth insights into an enterprise's sustainable development strategy, management model, and clearly understand the impact of the enterprise on society and the environment. At the same time, ESG disclosure helps enterprises enhance transparency and their sustainable development capabilities, attract more investment and consumption, and promote the sustainable development of enterprises and even the entire society. Therefore, ESG disclosure has become a crucial part of corporate social responsibility.
Take NVC Lighting as an example. In its development process, it has deeply realized that ESG is no longer an optional "multiple - choice question" but a "must - answer question" that must be faced directly.
ESG information disclosure essentially refers to the act of enterprises publicly disclosing information related to their economy, environment, and society. On the one hand, this information is like a window, enabling relevant parties such as investors, shareholders, suppliers, and customers to thoroughly understand the enterprise's operating status, the degree of fulfilling social responsibilities, and its future sustainable development plans. On the other hand, it is like a "baton", spurring enterprises to strengthen environmental protection, enhance their sense of social responsibility, optimize the corporate governance structure, and thus enhance the competitiveness and sustainable development potential of enterprises. As an important measure for enterprise development, ESG information disclosure has become a core reference for modern enterprise sustainable development.
The rise of ESG information disclosure stems from the increasing attention of all sectors of society to corporate social responsibility and sustainable development. With the rapid development of the global economy, the increasingly prominent climate and human rights issues have made people more aware of the important responsibilities of enterprises in society and the environment. Investors and consumers have an urgent need for more information to evaluate the performance of enterprises.
In this trend, international organizations have taken action. The United Nations Global Compact, the International Labour Organization, and many non - governmental organizations have strongly called on enterprises to disclose ESG information. The awakening of investors and consumers, coupled with the advocacy of international organizations, has prompted more and more enterprises to take the initiative in ESG disclosure. Investment funds and financial institutions that meet ESG standards have also grown rapidly. In this way, enterprises can enhance their social and market image and reputation through information disclosure, and investors and consumers can clearly understand the corporate social responsibility and sustainable development of enterprises, paving a more sustainable development path for both enterprises and investors.
Initial Stage (2005 - 2015): At that time, the concept of ESG was still relatively new in China. Investors had little knowledge of it, and information sources were fragmented. Facing the mandatory information disclosure requirements of the China Securities Regulatory Commission, most enterprises only focused on meeting the minimum standards, and rarely referred to standardized ESG indicators for disclosure. ESG information disclosure was just in its infancy in China.
Rapid Rise Stage (2015 - 2018): Thanks to the dual - drive of policies and the industry, the active participation of a large number of investors and research institutions, and the gradual improvement of ESG data and indicators, ESG information disclosure quickly became a hot topic in the Chinese investment field. During this stage, ESG information disclosure gradually penetrated into mainstream institutions in the Chinese market, and ESG indicators began to be incorporated into the analysis framework of the Chinese financial system. At the same time, the awareness of ESG information disclosure among enterprises and society has significantly increased. Some enterprises have taken the initiative to start ESG disclosure and established a more systematic ESG data collection and management system.
Deepening and Practice Stage (2019 - present): The quantitative and standardized processing of ESG data has been recognized internationally and has gradually taken root in the Chinese market. Many large - scale financial institutions, investors, and enterprises have taken practical actions. Regulatory authorities have also strengthened the requirements and norms for ESG disclosure. At present, ESG information disclosure has gone beyond the category of added value and has become a direct reflection of corporate social responsibility and a core element of sustainable investment.
As a pioneer in ESG information disclosure, governments and regulatory authorities in European countries have been proactive. They have introduced a series of ESG disclosure guidelines and standards for stock exchanges, providing clear regulations for listed companies' ESG disclosure behaviors and leading the global trend of ESG information disclosure.
Although the United States started a bit slower in ESG disclosure, in recent years, ESG brokers and investors have shown an increasing interest in relevant information. The U.S. Securities and Exchange Commission has also taken action, formulating relevant regulations to urge publicly - traded companies to disclose ESG issues. ESG disclosure is accelerating in the U.S. market.
Asian countries still have a certain gap in ESG information disclosure compared with Europe and the United States, but they are making steady progress. The importance of ESG disclosure is increasingly recognized by investors and enterprises in the Asian region. Many companies are required to disclose ESG data when they go public, demonstrating Asia's firm determination to move towards ESG disclosure.
Some companies in Africa have skillfully tapped the potential of sustainable energy such as solar and wind energy and actively communicate ESG information with investors. Enterprises in Latin America and the Caribbean have also gradually awakened, gradually understanding the importance of ESG and contributing to enhancing their own sustainable development capabilities. ESG information disclosure is blooming in multiple regions around the world.
The current disclosure standards are too single and lack pertinence. They are difficult to adapt to different types of enterprises, making it difficult for enterprises to identify and report their consistency with specific standards.
Most enterprises disclose information only to meet the limited requirements of the government or the market, rather than presenting a complete picture. As a result, it is difficult for investors and regulatory authorities to accurately evaluate enterprises.
Most enterprises' disclosed information focuses on economic indicators, pays insufficient attention to social and environmental aspects, and over - emphasizes financial and short - term indicators, making it difficult to comprehensively reflect the full picture of an enterprise's sustainable development.
At present, there are significant differences in the content and standards of ESG information disclosure among enterprises. ESG ratings lack a unified standard, and third - party certification is weak. The quality and authenticity of the information are widely questioned.
Due to the lack of effective publicity and promotion, investors and other stakeholders have limited knowledge of ESG information, making it difficult for them to make informed investment or business decisions.
Looking to the future, the ESG information disclosure standard system in China will become more independent and complete. The continuous reform of policies and regulations will comprehensively improve the quality and transparency of ESG information disclosure. At the same time, China will further strengthen mechanism construction, optimize relevant standards, guidelines, methods, and tools for ESG information disclosure, refine the ESG information disclosure system, and escort sustainable development.
With the continuous expansion of China's opening - up and the steady improvement of its global economic status, ESG information disclosure in China will be more deeply integrated into the international arena. Chinese investors and enterprises will actively participate in global ESG information disclosure activities, align with international standards, and promote the internationalization process of ESG information disclosure in China.
The booming development of big - data technology will inject strong impetus into ESG information disclosure in China. In the future, with the help of big data, efficient collection, accurate analysis, and scientific management of ESG information can be achieved, providing enterprises and investors with more comprehensive and accurate ESG information. At the same time, it can reduce the cost of disclosure, improve the efficiency and convenience of disclosure.
In the future, ESG information disclosure in China will focus on data quality and authenticity. Enterprises will strengthen internal management, lay a solid foundation for the reliability and transparency of ESG information, and ensure that the disclosed information is consistent with the actual situation. Investors will also become more discerning, strictly reviewing the authenticity of ESG information disclosure content, and jointly creating a higher - quality ESG information source for enterprises and investors.
