As one example of its progress: In August, the SEC approved Nasdaq’s new rule requiring listed companies to annually disclose board-level diversity statistics using a standardized template. “We believe this is about transparency that will help build a better reporting framework for the future, and help drive knowledge and diversity across the listed companies,” Dennison said.
ESG isn’t a nice-to-have. For Nasdaq, Dennison said, ESG is imperative for growth. “Gone are the days of the investor being the only stakeholder,” she said. An organization’s stakeholder base now includes its customers, employees, and communities.
“If you want to grow your investor base, you need to be focused on ESG,” Dennison said.
Nasdaq provides several solutions to help companies do that. With its ESG Data Hub, investment managers enter their diversity data, while asset owners assess that data to determine how to allocate their dollars. Nasdaq OneReport assists corporate clients in navigating the reporting complexity of ESG. And with Nasdaq’s carbon removal marketplace Puro.earth, corporate clients can procure offsets to neutralize their carbon footprint.
To bolster its own ESG reporting, Nasdaq placed its ESG function within its finance function within the past year. That shift in its ESG reporting structure is part of Nasdaq’s long-term vision, Dennison said, “to fully leverage our data across the organization.” For instance, Nasdaq has used Workday data to get a holistic look at its suppliers’ diversity. “Without that data, we can’t have a plan,” Dennison said.
Dennison shared three strategies for CFOs to meet their own ESG goals:
“ESG has to be part of your overall business strategy, not a side job,” Dennison said. It should be part of board-level conversations and objectives.
Think about the long-term strategy. “Then break that down into smaller pieces in the short term,” shared Dennison. That should include identifying near-term key performance indicators.
“Use your data in the most powerful way,” she explained. Automate where you can.