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  • MOODY'S

ESG Themes for 2022


Jimmy Greer

VP - Outreach and Research Moody’s ESG Solutions Group


Kachi Nwanna Manager

Research - Outreach & Research Moody’s ESG Solutions Group


Natalie Ambrosio Preudhomme

AVP – Outreach & Research Moody’s ESG Solutions Group


Summary


Having accelerated in the wake of the pandemic, access and affordability concerns will remain top of mind as rising inflation impacts living costs. We expect growing focus on how companies are addressing access and affordability of products and services, alongside improving sustainability performance.


Poor management of social and environmental risks in supply chains will compound ongoing operational resilience concerns that have proliferated over the course of the pandemic. Our ESG Assessment data finds “limited” disclosure scores on the integration of social and environmental factors in supply chains across key sectors.


Human capital management shifts will continue to put employees and their wellbeing into sharper focus. Working conditions and wider human resource practices are growing in importance, alongside elevated diversity, equity and inclusion concerns.


Turning momentum from COP26 into action will see demand for net zero accountability and transparency grow. Based on our Temperature Alignment dataset, only 3% of assessed companies globally are aligned with a future of net zero by 2050 based on their emissions reductions targets.


The “just transition” will become a stronger component of net zero economy plans and policies. Potential risks related to negative social consequences of the industrial transformations required will become more apparent for the most impacted sectors.


Last year’s momentum on nature and biodiversity will continue. The launch of the Taskforce on Nature-related Financial Disclosures (TNFD) and growing requirements, such as Article 29 in France and others from the EU, demonstrate an acceleration in calls for meaningful biodiversity disclosure.


Mainstreaming of impact measurement and management will continue. Greater awareness of the responsibilities to invest in the infrastructure needed to take on systemic risks of the future will see the common language of the SDGs sought out by more parties. ESG disclosure will take a step forward this year. But differences in the concept of materiality and the classification of sustainability activities will complicate efforts to create global standards.


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