Data Reporting
10 ESG Reporting Best Practices You Must Know About
Discover 10 ESG reporting best practices to improve transparency, meet compliance standards, and build stakeholder trust.
Aug 7, 2025
ESG data reporting is more critical than ever. As companies face growing pressure from regulators, investors, and other stakeholders to disclose their environmental, social, and governance (ESG) performance, understanding the nuances of ESG reporting is crucial. But let’s be honest, the whole process can be pretty daunting. From figuring out what to report to ensuring your data is accurate and reliable, there are plenty of challenges to overcome. That’s where this guide comes in.
We’ll walk you through the best practices for ESG reporting so you can approach your disclosures with confidence. And if you’re worried about all the time this might take, don’t be. We’ll also show you how to research fast and write accurately with AI. So, let’s get started. Otio’s AI research and writing partner is the perfect tool to assist you in your reporting journey, enabling you to quickly gather information and produce clear, concise reports that will impress your clients or agency.
Table Of Contents
Importance of ESG Reporting

Regulatory ESG Standards: The Legal Backbone of ESG Reporting
The surge in ESG reporting cannot be discussed without acknowledging the role of regulatory standards. Governments and agencies worldwide are implementing rules that make ESG disclosure mandatory. For example, the European Union’s Corporate Sustainability Reporting Directive (CSRD) requires large enterprises to disclose their ESG metrics.
In the United States, the Securities and Exchange Commission (SEC) is on the verge of introducing new regulations aimed at standardizing ESG reporting. These measures are part of a global push towards greater corporate accountability and transparency. Compliance with these standards is not just about avoiding penalties; it’s about aligning with a future where sustainable business practices are the norm.
Investor Demand: The Financial Sector’s Shift Towards Sustainability
Investors are no longer solely focused on financial returns; they want to understand how ESG factors impact long-term risks and opportunities. According to a 2024 EY Global Institutional Investor Survey, 90% of investors believe ESG disclosures are critical for making informed investment decisions. This shift is reflected in the rapid growth of ESG investments, which are expected to reach $50 trillion by 2025. Furthermore, studies show that portfolios incorporating ESG criteria often outperform traditional investments, highlighting the financial value of sustainability.
Consumer Expectations: Meeting Market Demands
Consumers are increasingly conscious of the social and environmental impact of their purchases. A Nielsen report found that 81% of global consumers think companies should help improve the environment. This growing demand for corporate responsibility means that companies must prioritize ESG disclosure to attract and retain customers. Doing so not only enhances brand reputation but can also translate into increased sales and market share.
Risk Management and Competitive Advantage
Proactively managing ESG risks can help companies avoid costly scandals, fines, and operational disruptions. Research from Harvard Business School shows that firms with strong ESG performance experience lower financial instability and enjoy better economic returns. Additionally, effective ESG strategies can lead to a competitive edge by improving operational efficiency, fostering innovation, and attracting top talent. A McKinsey & Company study found that companies excelling in ESG practices could boost operating profits by up to 60%.
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10 ESG Reporting Best Practices You Must Know About

1. Use Otio for Making Reports
In the era of information overload, creating comprehensive and accurate ESG reports can be a daunting task. Otio is an AI-native workspace designed to help researchers, knowledge workers, and students manage and make sense of vast amounts of data. With Otio, you can collect data from various sources, such as bookmarks, tweets, books, and videos. The tool then extracts key takeaways and generates AI-assisted notes to help you understand the content. Finally, Otio enables you to create draft reports based on the information you’ve gathered, speeding up the ESG reporting process.
2. Identify the Audience and Stakeholders
Before you begin reporting, it’s crucial to identify who your audience and stakeholders are. According to the Global Reporting Initiative (GRI), stakeholders are individuals or organizations that are affected by or can affect your company’s ESG initiatives. This group can include customers, employees, investors, suppliers, regulators, non-governmental organizations (NGOs), and local communities. Understanding your stakeholders’ needs and expectations will help you tailor your ESG report to provide relevant and valuable information.
3. Establish a Clear ESG Framework
Developing a structured ESG framework is essential for effective reporting. This involves defining the ESG metrics and key performance indicators (KPIs) that are relevant to your business. For example, a technology company might track energy consumption, waste generation, and employee diversity, with specific targets for improvement in each area. You can also adopt established standards and frameworks to guide your ESG initiatives. Next, set measurable ESG targets that align with global agreements and industry benchmarks. Collecting and managing high-quality, reliable data is crucial for tracking progress and meeting the requirements of various ESG reporting standards.
4. Report and Communicate Progress
Choose the appropriate platform for disclosing your ESG information. This could be a standalone sustainability report, an integrated annual report, or a specific section within your company’s annual filing. Make sure your report is clear, concise, and well-structured, with a summary of key findings and trends. Transparency is vital; include contextual information such as industry benchmarks, regulatory developments, and performance comparisons to provide a complete picture of your ESG efforts.
5. Review Policies and Industry Practices Regularly
The ESG landscape is constantly evolving, with new challenges and opportunities emerging all the time. Regularly review your ESG policies and practices to ensure they remain aligned with your long-term objectives, industry standards, and stakeholder expectations. This proactive approach will help you stay ahead of the curve and maintain the effectiveness of your ESG reporting.
6. Improve Data Collection
Reliable data is the backbone of any credible ESG report. Enhance your data collection processes by leveraging technology, such as specialized software that can automate the gathering and analysis of ESG information. Utilize established methodologies, like lifecycle assessments and carbon accounting standards, to ensure your data accurately reflects your environmental and social impact. Consider partnering with third-party providers to verify the accuracy of your data and ensure compliance with relevant regulations.
7. Align ESG Reporting with Business Strategy
Integrate your ESG initiatives with your company’s overall business strategy to maximize their impact. This alignment allows for more informed decision-making, helping you identify and manage sustainability risks and opportunities. You can also tie executive compensation to ESG performance, ensuring leadership accountability for achieving your sustainability goals. Strengthen your governance structures to embed ESG considerations into day-to-day operations and strategic planning.
8. Include ESG Initiatives and Sustainability Efforts
Be transparent about your company’s ESG initiatives, sharing both successes and challenges. Use real-world examples and case studies to illustrate the tangible impact of your efforts on the environment, society, and your business. Communicate how your sustainability programs benefit stakeholders, helping to build trust and credibility.
9. Report Climate Change Efforts and Environmental Impact
Address the critical issue of climate change by measuring your carbon footprint, setting reduction targets, and reporting on your progress. Include information on biodiversity conservation, ecosystem restoration, and other environmental initiatives that demonstrate your commitment to protecting the planet. Disclose climate-related financial risks and explain how your company is managing these challenges to ensure long-term resilience.
10. Report on Social Responsibility and Community Impact
Highlight your company’s social responsibility efforts, such as fair labor practices, human rights protections, and community engagement programs. Provide details on how you support workers, local communities, and other stakeholders through your ESG initiatives. This information will help demonstrate your company’s dedication to making a positive social impact beyond just financial performance.
Key Elements of ESG Reporting

Environmental Factors: The Planet's Health Report Card
When it comes to environmental reporting, companies need to lay it all out on the table. This means detailing their effects on natural resources and ecosystems. How much energy do they consume, and where does it come from? What are their greenhouse gas emissions, and how do they stack up against industry standards? How do they handle water usage and waste disposal? Answering these questions offers a glimpse into a company’s ecological footprint and its commitment to sustainability. If you want to gauge how serious a company is about environmental stewardship, the data in this section is a good place to start.
Social Factors: The Human Element
ESG reporting isn't just about the environment; it's also about people. Social factors assess how a company interacts with its workforce, customers, and the communities in which it operates. This includes labor practices, human rights policies, diversity and inclusion initiatives, and community involvement. Companies should also disclose their privacy policies and how they protect customer data. This section provides insight into a company’s culture and values. How do they treat their employees? Do they foster an inclusive workplace? Are they good neighbors in the communities they serve? These are the kinds of questions social reporting can answer.
Governance Factors: Who’s Calling the Shots?
Governance reporting shines a light on the people behind the curtain. It examines a company’s leadership structure, executive compensation, risk management, and business ethics. This section helps stakeholders understand how decisions are made and who is held accountable. Transparency is key in governance reporting. Stakeholders want to know that a company is being run ethically and responsibly. This section should address any potential conflicts of interest and outline the company’s approach to compliance and regulatory matters.
Goals and Performance: Setting the Bar
ESG reporting isn’t just about sharing data; it’s also about setting goals and measuring progress. Companies should outline their sustainability targets and explain how they plan to achieve them. This section should include specific metrics and timelines to provide a clear picture of their ESG journey. By setting measurable goals, companies demonstrate their commitment to continuous improvement. This section also allows stakeholders to track performance over time and hold the company accountable for its promises.
ESG Reporting Framework: Speaking the Same Language
To ensure consistency and comparability, companies should disclose the ESG reporting standards or frameworks they use. Common examples include the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB). Using established frameworks helps companies align their reporting with industry best practices. It also makes it easier for stakeholders to understand and trust the information presented.
Stakeholder Engagement: Who’s at the Table?
Effective ESG strategy requires input from a variety of stakeholders. This section should describe how the company engages with employees, customers, investors, and other interested parties. It should also explain how stakeholder feedback influences ESG priorities and decision-making. Engaging stakeholders helps companies identify material issues and align their ESG efforts with broader societal expectations. This section provides transparency around the company’s approach to collaboration and dialogue.
Risks and Opportunities: The Double-Edged Sword
ESG issues can pose risks to a company’s financial performance and reputation. However, they also present opportunities for innovation, growth, and competitive advantage. This section should identify potential ESG risks and describe how the company plans to mitigate them. It should also highlight any opportunities the company is pursuing to create value through sustainability. By addressing risks and opportunities, companies demonstrate strategic foresight and resilience. This section helps stakeholders understand the company’s preparedness for an evolving business landscape.
ESG Strategy: The Roadmap to Sustainability
This section provides an overview of the company’s ESG strategy. It should outline key priorities, initiatives, and action plans. It may also describe the governance structure supporting ESG efforts and any partnerships or collaborations that enhance the company’s impact. The strategy section offers context for the data and goals presented elsewhere in the report. It tells the story of how the company is integrating ESG into its core business and driving meaningful change.
External Assurance: The Seal of Approval
To enhance credibility, companies may seek independent verification of their ESG data and processes. This section should disclose any external assurance obtained and summarize the scope and findings of the review. External assurance provides stakeholders with confidence that the information reported is accurate and reliable. It also signals the company’s commitment to transparency and accountability.
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10 Best ESG Reporting Tools
1. Otio: AI-Powered Research & Writing Assistant

Today, researchers, students, and knowledge workers face content overload. Otio offers a solution by providing an AI-native workspace to help you collect information from diverse sources, extract key takeaways, and create draft outputs for your projects. This tool also comes with AI-assisted writing capabilities and lets you chat with your sources to enhance comprehension. Otio’s web scraping feature allows you to access data beyond traditional academic resources, making it a valuable partner for your research and writing tasks.
2. Novata: ESG Software for Private Equity & Venture Capital
Novata is designed for private equity and venture capital firms, providing a platform to manage environmental, social, and governance data. The software emphasizes a balanced approach to sustainability and offers a user-friendly interface for efficient ESG data management. This tool can help businesses integrate ESG considerations into their investment strategies and promote corporate responsibility.
3. Benchmark Gensuite: ESG Reporting for EHS Management
Part of a larger environmental, health, and safety management suite, Benchmark Gensuite’s ESG reporting software assists companies in compiling investment-grade data, taking action on sustainability commitments, and achieving performance targets. This platform is ideal for businesses looking to align their ESG efforts with broader EHS goals.
4. Sustain IQ: Real-Time ESG Data Tracking & Analysis
SustainIQ enables organisations to collect, monitor, and analyze ESG data in real time. By providing immediate insights, this software helps businesses make informed decisions that align with their ethical and sustainability objectives. SustainIQ is perfect for companies aiming to manage their social and environmental impact proactively.
5. Lucanet: Simplified ESG Reporting
Lucanet’s solution streamlines the ESG reporting process by automating data collection, analysis, and report generation. The platform includes pre-built templates aligned with global standards and integrates with financial reporting systems to ensure a cohesive view of your organisation’s sustainability performance.
6. Workiva: Adaptable ESG Reporting for Any Business
Workiva offers a flexible ESG reporting platform that can be tailored to suit the needs of any organisation. The tool promotes transparency and accountability in ESG practices, helping businesses of all sizes manage their sustainability data with ease.
7. IBM Envizi: Automated ESG Data Management
IBM Envizi ESG Suite centralizes the capture and management of your sustainability data. The platform specializes in calculating greenhouse gas emissions, streamlining reporting and disclosure, and identifying opportunities for decarbonisation.
8. Diligent: Customisable ESG Solutions for All Organisations
Diligent’s ESG platform caters to businesses of all sizes and industries. The software offers tailored solutions to improve sustainability practices and enhance ESG reporting, making it a valuable tool for any organisation focused on social responsibility.
9. Fairly Made: Traceability & Impact Measurement for Fashion
Fairly Made helps fashion brands trace their supply chains, measure the environmental and social impact of their products, and communicate this information to consumers through QR codes and widgets. This platform is ideal for companies seeking to improve transparency and accountability in their operations.
10. Novisto: Comprehensive ESG Data Integration
Novisto consolidates disparate ESG data sources into a single platform for effective management. The software simplifies the collection and analysis of sustainability data, enabling organisations to assess their ESG performance and make informed decisions accurately.
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Data reporting is the process of collecting, organizing, and presenting data in a way that is easy to understand. This allows businesses to make informed decisions based on the data. Data reporting can be done manually, but it is often automated using software tools. Automated data reporting is faster, more accurate, and less prone to errors than manual reporting.
Why Is Data Reporting Important?
Data reporting is essential because it helps businesses make sense of their data. Without data reporting, companies would be left to interpret raw data on their own, which can be difficult and time-consuming. Data reports summarize the data and present it in a way that is easy to understand. This allows businesses to quickly identify trends, patterns, and outliers in their data. Data reporting also helps companies to track their performance over time. By regularly reviewing data reports, businesses can see how they are doing and make any necessary adjustments to improve their performance.
The Different Types of Data Reports
There are many different types of data reports, each serving a specific purpose. Some of the most common types of data reports include:
1. Summary Reports
These reports provide a high-level overview of the data. They help identify trends and patterns.
2. Detail Reports
These reports provide a more in-depth look at the data. They help identify specific issues or problems.
3. Exception Reports
These reports highlight data that falls outside of standard parameters. They help identify anomalies or outliers.
4. Trend Reports
These reports show how data has changed over time. They help track performance and identify long-term trends.
5. Forecasting Reports
These reports use historical data to predict future outcomes. They help make informed decisions about the future.
Best Practices for Data Reporting
There are a few best practices to keep in mind when creating data reports:
1. Know your Audience
Before you start creating a data report, it is essential to know your target audience. This will help you determine what information to include in the report and how to present it.
2. Keep it Simple
Data reports should be easy to understand. Avoid using technical jargon or complex data visualizations.
3. Use Visuals
Visuals can make data reports more engaging and easier to understand. Use charts, graphs, and other visuals to help tell the story of your data.
4. Be accurate
Make sure your data is correct before you create a report. Inaccurate data can lead to incorrect conclusions and bad business decisions.
5. Update Regularly
Data reports should be updated periodically. This will help ensure that the information in the report is current and relevant.
Common Data Reporting Mistakes
There are a few common mistakes to avoid when creating data reports:
1. Reporting Too Much Data
It can be tempting to include every piece of data in your report, but this can be overwhelming for your audience. Instead, focus on the most critical data that will help your audience make informed decisions.
2. Ignoring Context
Data does not exist in a vacuum. It is essential to provide context for your data so that your audience can understand its significance.
3. Failing to Explain the Data
Don’t assume that your audience will understand the data on their own. Take the time to explain what the data means and why it is essential.
4. Not Testing your Report
Before you distribute your data report, make sure to test it with a small group of people. This will help you identify any issues or areas of confusion before the report goes public.
Data Reporting Tools
There are many data reporting tools available, both free and paid. Some of the most popular data reporting tools include:
1. Microsoft Excel:
Excel is a powerful data reporting tool that is widely used in businesses of all sizes.
2. Google Sheets
Google Sheets is a free, web-based spreadsheet tool that can be used for data reporting.
3. Tableau
Tableau is a paid data visualization tool that can be used to create interactive data reports.
4. Power BI
Power BI is a paid data reporting and visualization tool from Microsoft.
5. Looker
Looker is a paid data reporting and analytics platform.
How to Choose the Right Data Reporting Tool
When choosing a data reporting tool, there are a few factors to consider:
1. Cost
Data reporting tools can range in price from free to thousands of dollars. Choose a tool that fits your budget.
2. Ease of Use
Some data reporting tools are more user-friendly than others. Choose a tool that you and your team can use without extensive training.
3. Features
Different data reporting tools offer various features. Choose a tool that has the features you need to create effective data reports.
4. Integration
If you use other software tools in your business, make sure your data reporting tool can integrate with them. This will make it easier to collect and report on your data.
5. Support
Choose a data reporting tool that offers good customer support in case you run into any issues.
Final Thoughts
Data reporting is an essential part of any business. It helps companies to make sense of their data so they can make informed decisions. There are many different types of data reports, each serving a specific purpose. When creating data reports, be sure to keep your audience in mind, use visuals, and update your reports regularly. Avoid common mistakes like reporting too much data and ignoring context. Choose the right data reporting tool for your business based on cost, ease of use, features, integration, and support.
Otio offers a solution by providing an AI-native workspace that streamlines the research process. It allows users to collect data from various sources, extract key takeaways, and create draft outputs, significantly reducing the time spent on research and writing. With features like AI-generated notes, source-grounded Q&A chat, and AI-assisted writing, Otio is set to become an indispensable tool for researchers.
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