Top 10 ESG challenges in internal communication

ESG is becoming increasingly important to companies and leaves the communication departments with a number of challenges in managing ESG strategy and communications efforts.

IESG communication can be a game changer for many organizations, leaving many communication departments with both opportunities and challenges within corporate ESG communication. And even bigger problem is that ESG in most cases are not served in a digital infrastructure.

1) Increased but unfocused attention to ESG 
All companies that have ESG integrated as part of their business strategy vary significantly in the maturity of their ESG communication. Some companies have integrated ESG deeply into their core narrative, while others have minimal involvement from the communications department.

2) Lack of organization 
There is often a lack of clear structure in working with ESG and it is described as “a hive without a queen”. Communication managers in C25 companies often have sustainability in their title, but their involvement in ESG work varies significantly.

3) Increasing importance of regulation
There is a significant increase in regulation around ESG communication. Rules are being enforced more stringently and data on ESG issues is seen as crucial to compliance and credibility. Few companies have clear structures for data collection and analysis.

4) New regulatory requirements as a positive driver
New regulatory requirements, especially from the EU Green Deal, are seen as a positive factor for the integration of ESG in companies. Specifically, the Corporate Sustainability Reporting Directive (CSRD) is mentioned as an important driver for increased ESG reporting, although companies are divided in their perception of the requirements.

5) Need for focus, new language and new formats
There is a need to prioritize focus, develop new language and new formats for ESG communication. Communicators need to become familiar with ESG language and translate it to the company context. New formats are also needed as standalone sustainability reports disappear.

6) Strategic cross-organizational collaboration
Successful ESG communication depends on collaboration across the organization. Communications professionals need some degree of ESG expertise, but most important is interdepartmental collaboration.

7) Critical tasks for communicators
Managing commmunications invoves clarifying the ESG narrative and ownership internally, preparing for integrated reporting, developing a clear data collection structure and establishing evidence for ESG claims aligned to corporate ESG narratative.

8) Contributes to business strategy
ESG contributes to the company's value creation and requires strategic communication, and everyone from leaders to employees must accept the importance and ownership of these efforts.

9) Documentation and credibility challenges
There is an urgent need to develop data collection and analysis structures to provide credible ESG data. Credibility is key to meeting regulatory requirements and gaining stakeholder trust.

10) Customer pressure and regulatory requirements as key drivers
There is some skepticism around the idea of customer pressure as a driver for increased ESG efforts, while regulatory requirements are seen as the primary driver. CSRD is mentioned as an important factor for increased reporting and corporate ESG focus.