Why the best ESG reports tackle tough issues head‑on

As a writer and content strategist for CRI’s clients, I work with businesses across industries and at all levels of reporting maturity, from first-time reporters to those with decades of experience setting and achieving goals. I also study the reports of our clients’ peers and sustainability leaders worldwide to track trends in storytelling and disclosure.

One thing I’ve noticed that sets seasoned reporters apart from the rest: a willingness to honestly reckon with the challenges that stand in the way of progress on environmental, social and governance (ESG) issues.

This might seem counterintuitive — after all, reports are often a vehicle for sharing all of the good your organization has accomplished over the past year. But communicating that good work requires context and contrast. Here are a few reasons that I think a discussion of challenges has an important place in ESG reporting.

It puts progress in perspective.

In the most basic sense, ESG report narratives are before-and-after stories. They show continuous improvement, informing readers about programs and initiatives that move the needle on a problem a business is facing. Many clients want to skip over the problem and jump ahead to the solution — but it’s impossible to fully appreciate the “after” without the “before.”

If you want readers to understand why your new safety training program matters, start by establishing the stakes. What types of risks did workers face in the past? When was the “desk-pounding moment” — the time you decided to make a change? And how does your solution address the issue? Framing your accomplishments in this way (ideally, supported by year-over-year data) creates an opportunity to tell an ongoing story over the course of successive reports.

It gives you credibility.

I’m constantly hearing from clients who want their writing to sound more “human.” Word choice and style can go a long way to achieving this — but another way a corporation can sound more like a person is by admitting they’re not perfect. While you don’t need to dwell too much on the negatives, suggesting that you never face any roadblocks may make readers wonder what parts of a story you’re leaving out.

As an example, many corporations are exploring renewable energy investments as part of their emissions reduction goals. But some are meeting stumbling blocks, including cost, lack of suitable space for onsite installations and scarcity of power purchase agreements matched to their loads. These businesses are engaged in due diligence, but this work isn’t reflected in progress toward their goals. Instead of glossing over this, explain it to readers. Owning your challenges allows you to put your efforts in context and tell your story on your own terms.

It highlights the need for collective action.

Corporations have an outsize ability to make a difference on societal issues like climate change, overconsumption and income inequality. But no business can solve any one of these problems on its own. Alongside individual businesses taking action, lasting change often involves industry collaboration, multi-stakeholder initiatives and supportive public policies. Drawing attention to these complex challenges — and equally complex solutions — helps set the stage for a nuanced discussion of the issues.

For instance, the United States’ transition to electric vehicles requires more than automakers’ development of battery technology. It also calls for nationwide charging infrastructure and state-level incentives that shape consumer behavior. Carmakers can share the progress they’re making on their side of the equation — and highlight the ways they’re engaging with other stakeholders to amplify their impact.

It reveals your character.

Many ESG reports cover a common set of topics, from environmental protection to employee and community engagement. With many businesses approaching these issues in similar ways, it can be hard for readers to see what sets you apart. But moments of adversity can be a time to show your true colors.

We’ve worked with businesses during periods of disruption, including mergers and acquisitions, facility closures and layoffs. One CRI client offered a range of resources to employees who were laid off, like resume reviews, job placement services and the option to transfer to roles in other parts of the business. These concrete actions spoke far louder about the company’s culture than a vague statement of concern ever could — and made for a powerful story in its next ESG report.

It will help you prepare for mandatory disclosures.

A new era of ESG reporting is coming, with mandatory disclosures in force or expected in many parts of the world. These new disclosures will cover potentially sensitive topics, such as value chain emissions, human rights due diligence, cybersecurity and biodiversity. By working with legal and assurance teams to hone your responses to these topics now — even when you don’t yet have all the answers — you’ll begin to strengthen your disclosure muscles. Once you do, you’ll be better prepared for a new reporting reality.

Of course, ESG reports shouldn’t be all doom and gloom. They are absolutely a place to celebrate your wins and inspire readers with the many ways you’re making a difference. But as you prepare to share your company’s progress, remember that every good story hinges on conflict. By getting real about challenges, you can create a memorable report with a story that only you can tell — one that shows you’re committed to doing the work, even when the going gets tough.