The Perception vs. Ratings Gap in ESG

Communications leaders know that perception is reality, and it’s no different when it comes to your company’s ESG initiatives. In a recent analysis, RepTrak’s Data Science Team found that there may be a gap between what your company does, and what your stakeholders think your company does when it comes to ESG.

The above chart shows anonymized data of over 200 Fortune 500 companies, with each point representing a different company. Four major players are called out to demonstrate how perceptions of their ESG efforts track (or don’t) with their ESG ratings.  

Major Oil & Gas company: This company received a high ESG rating, but is perceived as doing less than they are. The company isn’t getting the recognition it deserves.

Major Financial Services company: This company is ranked poorly both in terms of actual ESG initiatives and perceived ESG initiatives. It’s not doing much in the way of ESG, and everyone knows it. 

Major SaaS Company: This company receives a high rating for its ESG efforts.  The company has successfully communicated its ESG efforts out and the public’s perception is positive as a result.

Major Delivery Services Company: This company received a lower rating for its ESG initiatives, , but currently the public thinks it is doing a great job.  This company is at risk if the public’s perception changes based on the company’s actions.

Mind The ESG Perception and Reality Gap

If there’s a gap between your company’s ESG rating and the public's perception of your ESG efforts, it could affect your bottom line. People are 60% more likely to buy from a company with a high ESG perception score than a low one:

ESG is a Key Differentiator in Purchase Decisions

Do You Have an ESG Perception Gap?

If you do (and it’s not in your favor), it’s time to solve it. If you don’t know, it’s time to measure it. Here’s what you need to measure and how :

 ●      Assess how your company's ESG efforts are perceived by the audiences you care about 

●      Analyze your company’s performance across time to see how you are moving the needle

●      Benchmark your performance against your competitors to know where to focus your time and resources

Are you getting credit for your ESG initiatives? Click here and see how you can capture and measure the impact of your ESG communications.