ESG and the Earnings Call: Communicating Sustainable Value Creation Quarter by Quarter

Abstract

In this paper, we begin by discussing concerns that existing reporting practices, including those used on quarterly earnings calls, underweight ESG disclosures and amplify short-term pressures on corporate management. We survey the broad market trends that are encouraging greater focus on ESG and long-term strategy disclosures.

Building on extensive interactions with market participants, including sell-side analysts, we set out practical recommendations and a framework for how issuers can embed disclosures on ESG and long-term strategy into the content of the quarterly earnings call. These recommendations can be readily ope-rationalized to meet the increased demand for ESG and long-term strategy information across the reporting ecosystem.

Keywords: Corporate Governance, ESG, Sustainability, Disclosure, Corporate Accountability, Investments, Corporate Performance

JEL Classification: G10, G14, G2, G23, M1, M2, M4