ESG Information: Mark up to reduce risk
An article by Romane Maguet and Thomas Verdin, of XBRL Europe, in Revue Banque this week calls for ESEF-style tagging to be extended to non-financial information.
The Covid-19 crisis has demonstrated how essential information – often found in non-financial data – in a crisis can be difficult to find and use. Wider expansion of machine-readable, tagged reporting could make access to key figures rapid and direct.
The authors argue that the incoming ESEF mandate could provide a platform for further standardisation of non-financial data, in accordance with appropriate taxonomies.
This could provide the basis for more comprehensive risk analysis, allowing banks to better assess the ecological and social impact of financing, both to better communicate their own ESG commitments and to best target their risk measures.
At XBRL International we have been arguing for exactly these kinds of developments. not just in the EU, but worldwide. More and more, it looks like this might be an important aspect of the future of corporate reporting.
Read more here.