ESG Benchmarks: Unlock the Value of Your Sustainability Data
To truly understand a company’s performance, executives, investors, and stakeholders must look beyond financials. This wider lens includes environmental, social, and governance (ESG) metrics, which align with a company’s goal to operate sustainably, manage risk, and unlock growth. While financial performance is easy to measure, it has historically been harder to assess sustainability metrics. That’s where ESG benchmarking comes in.
ESG benchmarks are an important analytics tool that act as a compass, guiding companies toward success by comparing their data to wider industry standards. Without this comparison—either within your industry or among peers—it’s tough to gauge if you’re heading in the right direction. Benchmarking helps assess progress in key sustainability areas, providing context to the data collected and highlighting areas for improvement.
Novata’s ESG benchmarks are tailored for private companies, using aggregated, anonymized data from thousands of companies on the Novata platform. With over 3,000 benchmarks, you can compare performance across industry, sub-industry, or geography. These benchmarks are normalized to account for factors like company size, allowing for fair comparisons regardless of firm size.
For instance, say you’ve been tracking social metrics, such as the number of women on your board. On average, companies reporting on the Novata platform have six board members, and nearly 50% report zero women on their boards (source: 2023 Novata Benchmarks). By comparing your data against industry benchmarks, you can see how you measure up and use those insights to attract investors or partners and build a foundation for growth.
Similarly, the insights from benchmarking can enhance risk management. In an area such as carbon accounting, which is becoming increasingly business-critical for companies, understanding not just what the Scope 1, 2, and 3 emissions are but also what they mean in context can guide how to move forward. For example, only 25.2% of companies on the Novata platform track greenhouse gas (GHG) emissions, and just 18% have a Net-zero target. Less than a third of companies (source: 2023 Novata Benchmarks) report having a carbon emissions reduction initiative. Identifying underperformance in areas like carbon emissions helps companies prioritize corrective actions, mitigate risks, and transition to clean energy—potentially driving stronger financing and valuations.
With the growing demand for transparency from regulations, investor requests, and other stakeholders, the need to connect ESG efforts to tangible results is more critical than ever. Benchmarking contextualizes your data, giving you clarity to assess performance, manage risks, reduce costs, and drive growth.
About Novata
Novata is an ESG data management platform and advisory practice that empowers businesses to achieve their sustainability goals. We make it easy for private markets to navigate the evolving ESG landscape; collect, analyze, and report on the metrics that matter; and connect their sustainability strategy to meaningful outcomes—because it’s good for business and it’s good for the planet.
Our industry-leading technology offers flexible tools to meet increasing market and regulatory demands, while our advisory services provide expert support for strategy, performance management, carbon accounting, reporting, risk resilience, and regulatory readiness.
Backed by the Ford Foundation, Hamilton Lane, Microsoft, Motive Partners, Omidyar Network, and S&P Global, Novata is majority controlled by mission-driven organizations and its employees, and is a B-Corp-certified public benefit corporation. www.novata.com
