Quantive launches Quantive StrategyAI, the world’s first strategic intelligence platformRead the blog to learn more
Quantive launches Quantive StrategyAI, the world’s first strategic intelligence platformRead the blog to learn more

What Are ESG Frameworks? How to Choose the Right One for Your Business

Estimated read time icon
14 min read
an image of a transparent diagram alluding to ESG frameworks

This article was written in collaboration with PM2 Consulting’s executive partner, Brett Knowles. 

ESG is a set of criteria for evaluating an institution’s performance in environmental, social, and governance areas. As ESG becomes more important in investing and business decision-making, stakeholders are becoming more interested in companies’ environmental impact. 

As interest has grown, so have numerous ESG frameworks and standards. Colloquially known as the “Alphabet Soup,” ESG reporting frameworks (like GRI, SASB, and CDSB) have become essential for navigating the complex landscape of ESG.  

In this article, we’re going to clarify: 

  • What is an ESG framework 
  • Why use a framework for ESG 
  • The 14 most popular ESG reporting frameworks  
  • Pros and cons of each ESG framework 
  • How to choose the right ESG reporting framework 
  • How to prepare for growing ESG trends

What is an ESG framework?

Key takeaway: ESG frameworks offer a clear roadmap toward a more sustainable future by improving ESG performance and reporting. 

Established by institutions such as NGOs and governments, ESG reporting frameworks are composed of guidelines, standards, and principles — these work in conjunction to manage your environmental, social, and governance commitments. 

Typically, ESG reporting frameworks include a range of ESG performance measurements, including board diversity, greenhouse gas emissions, and DE&I 

They also guide on: 

  • What ESG metrics you should track and report 
  • How to structure your ESG report 
  • How to think about your ESG strategy — processes, tools, people, etc.  

Interested in ESG reporting but need somewhere to start? Dive into the details of ESG reporting here.

ESG reporting frameworks vs. ESG standards

While ESG frameworks provide guidance and best practices, ESG standards are benchmarks of ESG commitment you must meet.  

These represent the quality of your ESG efforts which can be used by investors, rating agencies, and other stakeholders to evaluate performance. 

Why use an ESG reporting framework?

ESG reporting frameworks go beyond managing ESG efforts. Additional benefits of adopting ESG frameworks include: 

  • Meeting stakeholder expectations: Meet the expectations of ESG-conscious stakeholders to build trust 
  • Regulatory compliance: With ESG regulations becoming more prevalent, an ESG framework keeps you in the clear 
  • Managing risk and opportunities: ESG frameworks can support business longevity by identifying ESG risks and opportunities 
  • Standardizing ESG performance: An ESG reporting framework can benchmark your performance against peers through standardized ESG factors 
  • Providing a competitive advantage: The use of ESG frameworks can give you a competitive edge by demonstrating your commitment to sustainability 
  • Access to capital: An ESG reporting framework can help you attract new investments 

Voluntary ESG frameworks vs. guidance ESG frameworks

Voluntary ESG Frameworks

Voluntary ESG frameworks allow companies the flexibility to choose and implement ESG practices that match their objectives and values. These ESG frameworks provide guidelines rather than strict regulations, allowing customization to fit unique circumstances and stakeholders. Examples include the Global Reporting Initiative (GRI), the Sustainability Accounting Standards Board (SASB), and the Task Force on Climate-related Financial Disclosures (TCFD).

Guidance ESG frameworks

On the other hand, guidance ESG frameworks provide more specific guidelines and standards for measuring ESG performance, enhancing comparability and accountability. While compliance may require more resources, it ensures consistency and standardization in ESG reporting and disclosure. Examples include the United Nations Sustainable Development Goals (SDGs), the European Union's Non-Financial Reporting Directive (NFRD), and the Carbon Disclosure Project (CDP)."

List of ESG frameworks

ESG frameworks target one of three different audiences: 

  1. Investors: ESG frameworks help inform investor decision-making about a potential investment’s sustainability performance 
  2. Government: ESG reporting frameworks serve as guidelines, enabling governments to provide sustainability-related services and support 
  3. Management: ESG frameworks translate sustainability-related concepts into tangible activities and outcomes for organizations 

Each ESG reporting framework caters to a specific audience, so there is no singular framework for all the groups.  

We categorize the ESG frameworks below: 


a graphic showing categories of esg frameworks

Most ESG frameworks target investor needs, but the most popular framework (i.e., UN-SDGs) targets governments. As another caveat, three frameworks exist for businesses — two are certification-related, not operational.  

Let’s take a closer look at each of these. 

CDSB - Climate Disclosure Standards Board

The Climate Disclosure Standards Board (CDSB) is a non-profit organization offering ESG reporting on climate-related risks and opportunities. It covers four key areas: greenhouse gas emissions, climate-related risks and opportunities, carbon pricing, and climate-related financial reporting.  


  • Compatible with other reporting standards, such as GRI and SASB 
  • Offers standardized reporting to improve investor confidence in company sustainability 
  • Enhances consistency and comparability across institutions through standardization 


  • Lacks authority to enforce reporting requirements 
  • Relies on subjective judgments, which can lead to inconsistencies or inaccuracies 
  • Limits focus on climate-related risks and opportunities instead of broader ESG issues 

CDP - Carbon Disclosure Project

The Carbon Disclosure Project (CDP) helps institutions report their ESG impact. This ESG framework uses a questionnaire covering climate change, deforestation, and water usage, which then calculates a sustainability score and provides feedback on potential ESG risks and opportunities. 


  • Helps identify environmental risks and opportunities 
  • Offers benchmarking to show institutions how they compare with peers 
  • Facilitates transparency with stakeholders on carbon emissions and environmental impact 


  • Can be time-consuming and resource intensive 
  • Has a limited scope on carbon emissions and environmental impact 
  • Doesn't enforce sustainability targets or hold companies accountable 

DJSI - Dow Jones Sustainability Indices

The Dow Jones Sustainability Indices (DJSI) was launched in 1999 as the first global sustainability benchmark, serving as the lead ESG reporting framework to track ESG performance in top companies. 


  • Worldwide credibility as the benchmark for sustainability performance 
  • Evaluates companies within their respective industry 
  • Assesses companies based on a broad range of ESG factors, providing holistic evaluation 


  • Uses publicly listed companies — small, family-owned, and private businesses aren’t included 
  • Relies on subjective evaluations, which can lead to inconsistencies or inaccuracies 
  • Can be resource-intensive, limiting access for smaller companies 

FFBB - Future-Fit Business Benchmark

The Future-Fit Business Benchmark (FFBB) is an ESG framework based on systems science, which tells us how our economy would transform if we lived harmoniously with nature. The FFBB translates this into principles, goals, and indicators to guide institutions in getting us there. 


  • Covers a wide range of ESG issues — climate change, biodiversity, and inequality 
  • Relies on scientific evidence from relevant research on environmental and social issues 
  • Provides clear guidance on the to-do's of becoming sustainable 


  • Complexity requires significant resources and expertise to implement 
  • Caters to larger companies — applying the FFBB to specific contexts is challenging for local/regional markets 
  • Has a rigid set of metrics and targets that aren’t adaptable 

GRESB - Global Real Estate Sustainability Benchmark 

The Global Real Estate Sustainability Benchmark (GRESB) is the widely recognized ESG framework for assessing the sustainability performance of worldwide real estate assets and portfolios.  

It provides ESG performance data and peer benchmarks to inform investment decisions, drive sustainability improvements, and improve real estate sector engagement. 


  • Allows real estate companies to showcase their ESG performance with a consistent benchmark 
  • Helps companies compare their sustainability performance to peers 
  • Covers a comprehensive range of ESG topics 


  • Time-consuming, requiring significant resources to collect and report data 
  • Limited scope on commercial and institutional real estate assets 
  • Its rigidity doesn’t account for unique sustainability challenges 

GRI - Global Reporting Initiative 

The Global Reporting Initiative (GRI) is an independent organization providing a sustainability ESG framework. As the leading standard for sustainability reporting, it focuses on material issues relevant to stakeholders, including universal, sector, and topic standards. 


  • Calculates KPIs, enabling an in-depth understanding of environment, economic, and societal impacts 
  • Incorporates insights into sustainability efforts with a global reporting language 
  • Covers reporting for 34 negative and positive, topic-specific standards 


  • Can be complex and time-consuming to implement 
  • Not comprehensive, widely accepted, or standardized enough for some stakeholders 
  • Focuses on disclosure versus ESG performance, where organizations can report on ESG impact without improving it  

ISO - International Organization for Standards

The International Organization for Standards (ISO) is an independent, non-governmental organization that provides institutions with standards across hundreds of ESG topics. These are consensus-based standards involving industry experts, NGOs, governments, and other global stakeholders. 


  • Widely recognized and accepted across the world 
  • Improves efficiency, reduces waste, and increases productivity 
  • Enables organizations to access new markets, particularly in highly regulated sectors 


  • Isn’t flexible enough to cover company-specific needs 
  • Has the potential to become over-standardized 
  • Is voluntary, so doesn’t enforce compliance 

ISSB - International Sustainability Standards Board

International Sustainability Standards Board (ISSB) was first announced by the Trustees of the IFRS (international financial reporting standards) Foundation in 2021. These standards will provide a global baseline for sustainability standards, proposing high-quality disclosure on climate and sustainability issues to investors and capital market participants.   

As this ESG reporting framework hasn’t been issued yet, no data on advantages and disadvantages is available. 

SASB - Sustainability Accounting Standards Board

The Sustainability Accounting Standards Board (SASB) is an ESG framework covering five critical areas of sustainability: human capital, social capital, environment, business model and innovation, and leadership and governance. It includes a research-based approach with open participation from companies, subject-matter experts, and investors. 


  • Provides industry-specific standards for reporting relevant and material information to stakeholders 
  • Offers free comparable sustainability data for benchmarking  
  • Can be combined with other standards and framework (e.g., TCFD) 


  • Standards are voluntary, potentially leading to inconsistent reporting 
  • Focuses on financial materiality, forgoing aspects of sustainability important to stakeholders 
  • Complex to adopt, which may require additional expertise 

SBTi - Science Based Targets initiative 

The Science Based Targets initiative (SBTi) is a collaboration between multiple organizations (e.g., CDP, the World Resources Institute) to help reduce greenhouse gas emissions. This ESG framework offers guidelines for science-based targets across the value chain, including emissions from supply chain, customers, and products. 


  • Assists institutions in future-proofing, preparing them for upcoming regulations 
  • Helps institutions become leaner, reducing reliance on fossil fuels 
  • Improves investor confidence, with SBTi adherence improving business longevity 


  • Can be time-consuming and resource-intensive 
  • Focuses on reducing greenhouse gas emissions — doesn’t consider other sustainability issues 
  • Lack of urgency has been critiqued in the SBTi’s approach to the climate crisis 

UN SDGs - United Nations Sustainable Development Goals

The United Nations Sustainable Development Goals (UN SDGs), established in 2015, lists 17 goals that help create a more sustainable and equitable future. This ESG framework aims to end poverty, protect the planet, and promote peace and prosperity through education, healthcare, gender equality, and clean energy. 


  • Addresses the most pressing issues using a common global language and framework  
  • Is highly inclusive, ensuring marginalized groups aren’t an afterthought 
  • Has clear ESG metrics and indicators, allowing for better progress tracking and accountability 


  • Sets unrealistic, overly ambitious targets 
  • Prioritizes economic growth over social and environmental issues 
  • Proposed ESG goals require significant funding 

TCFD - Task Force on Climate-Related Financial Disclosures

The Task Force on Climate-Related Financial Disclosures (TCFD) are recommendations for promoting informed investment, credit, and insurance underwriting decisions according to sustainability reporting standards. 


  • Helps institutions understand and manage climate-related risks 
  • Provides a standardized approach to climate-related financial reporting 
  • Encourages institutions to integrate climate-related information into decision-making  


  • Focuses on short-term risks and opportunities, as opposed to long-term impacts 
  • Emphasizes climate, overlooking other important ESG issues 
  • Lacks consensus around some recommendations (e.g., disclosure of forward-looking information) 


Sustainalytics is a global provider of ESG research and ratings, offering company research, risk assessments, and portfolio analytics solutions. These services primarily serve investors, helping them understand the ESG risks and opportunities in their investments.   


  • Provides extensive ESG research and ratings 
  • Uses a rigorous, transparent methodology to assess ESG performance 
  • Tailors ESG research and ratings to specific clients’ needs 


  • Primarily focuses on large-cap companies 
  • Relies on public data to assess ESG performance, which may be inaccurate 
  • Can be costly to implement 

WEF - World Economic Forum 

The World Economic Forum (WEF) ESG reporting framework helps institutions report their ESG performance using 21 core and 34 expanded metrics across four pillars — governance, planet, people, and prosperity. 


  • Aligns with other ESG reporting standards (GRI, SASB) 
  • Covers a broad, comprehensive range of ESG metrics and reporting 
  • Credible as an ESG reporting framework 


  • Still relatively new, making it difficult for companies to benchmark themselves  
  • Relies on self-reporting, which may lead to a lack of transparency and accuracy in reporting 
  • Extensive metric quantity makes it difficult for companies to report 

CSRD - Corporate Sustainability Reporting Directive

Mandated by the European Union, the CSRD enhances corporate transparency by requiring large companies and financial institutions to disclose sustainability information. Aligned with global standards, it promotes consistency in reporting and facilitates informed decision-making on environmental, social, and governance (ESG) matters.


  • Aligns with international ESG standards (GRI, SASB)
  • Covers a comprehensive range of ESG metrics
  • Offers credibility as a robust reporting framework


  • New implementation may hinder benchmarking
  • Relies on self-reporting, potentially impacting transparency
  • Complexity of metrics poses reporting challenges"

Can a company use multiple reporting frameworks?

Adopting multiple ESG frameworks can give you a comprehensive view of your sustainability performance. By picking frameworks that align with specific ESG considerations, you can address various stakeholder interests and expectations. 

While this can help you provide a holistic perspective on ESG intiatives, several complexities may arise when managing multiple ESG reporting frameworks. Navigating these requires careful consideration across reporting consistency, ensuring transparency, and refining the disclosure of ESG-related information. Striking this balance can help you meet stakeholder expectations and reinforce your commitment to sustainable business practices in a way that resonates with the broader business community.

How to choose the right ESG reporting framework?

With so many ESG frameworks available, choosing one may be overwhelming. Here's what you should consider when picking an ESG reporting framework for your organization:  

  • Understand the purpose of your ESG reporting framework to choose a well-aligned solution 
  • Assess which ESG frameworks are better suited to specific industries and company types  
  • Consider credibility in the ESG reporting framework based on recognition and acceptance by industry stakeholders
  • Assess the scope and coverage of ESG factors in the framework  
  • Consider the current regulatory environment in your jurisdiction and industry 
  • Evaluate if using multiple ESG frameworks simultaneously will create a more accurate ESG report 

How to prepare for growing ESG trends?

As ESG keeps evolving, businesses must constantly reshape their strategies, operations, and reporting methods. Among these changes are two significant trends: the merging of AI and dynamic regulatory shifts. These trends aren't just emerging—they're becoming crucial cornerstones shaping the future of ESG practices.

AI and ESG 

The impact of AI extends far and wide, reaching ESG as well. Using AI, businesses can sift through massive pools of ESG data, compare against industry norms, and improve decision-making to drive ESG results. This helps businesses connect ESG stats to financial outcomes and steer more innovative sustainability strategies. However, lingering worries about biases, data privacy, and environmental effects persist, demanding a close eye on the ethical implications of using AI for ESG.

Tips for integrating AI into ESG initiatives

  • Invest in AI integration: Prioritize AI tools tailored for ESG analysis and reporting, choosing platforms that can handle diverse and substantial datasets while accurately validating information in a scalable way.
  • Ensure ethical AI implementation: Create a robust ethics framework for AI in ESG, emphasizing bias reduction, data privacy, and environmental responsibility while simultaneously conducting regular audits to rectify biases and ensure comprehensive adherence to ethical guidelines.
  • Upskill workforce: Create training programs that teach employees the necessary skills for leveraging AI insights into their work and foster continuous learning by staying updated on AI advancements.

Dynamic regulatory changes

Regulatory changes are swiftly reshaping the ESG landscape globally, emphasizing standardized reporting requirements. Major economies, including the U.S. and the EU, are proposing mandates for ESG disclosures, reflecting a trend toward unified reporting standards. Efforts to consolidate reporting frameworks under entities like the International Sustainability Standards Board (ISSB) aim to streamline practices, simplifying the complex landscape of ESG reporting entities. These changes highlight a significant push for clarity and standardization in reporting practices across various sectors and industries.

Tips for navigating regulatory changes 

  • Stay informed and educate employees: Regularly track regulatory updates and evolving standards in ESG reporting, conducting training sessions or workshops to ensure employees understand the nuances of these changes and their implications for your business.
  • Assess and adapt current ESG reporting standards: Assess your existing ESG reporting mechanisms against upcoming standards, identifying gaps and aligning internal reporting structures to meet emerging requirements.
  • Develop agile ESG reporting: Create adaptable reporting structures that swiftly incorporate new mandates or changes in ESG regulations, ensuring your business remains compliant while minimizing disruptions to ongoing operations.

Navigating ESG frameworks: Final thoughts

Achieving meaningful ESG progress is all about choosing the most aligned ESG framework for your business goals, industry standards, and relevant ESG factors. It’s the difference between truly embedding ESG practices and simply going through the motions.  

Investing in the right ESG framework can demonstrate your commitment to ESG, minimize risks, and unlock new opportunities — ultimately, ESG builds long-term value for stakeholders and drives a sustainable future for your business and the community. 

Quantive empowers modern organizations to turn their ambitions into reality through strategic agility. It's where strategy, teams, and data come together to drive effective decision-making, streamline execution, and maximize performance.  

As your company navigates today’s competitive landscape, you need an Always-On Strategy to continuously bridge the gap between current and desired business outcomes. Quantive brings together the technology, expertise, and passion to transform your strategy from a static plan to a feedback-driven engine for growth.  

Whether you’re a visionary start-up, a mid-market business looking to conquer, or a large enterprise facing disruption, Quantive keeps you ahead — every step of the way. For more information, visit www.quantive.com

Additional resources

Subscribe for our Newsletter