This week, we would like to discuss how artificial intelligence (AI) language models can support the development of sustainability strategies.
As we have all recently witnessed, AI tools are becoming more and more sophisticated (I guess by now most of you have tried ChatGPT as an example). Many people wonder if this new AI revolution will lead to job cuts, and some say it should eventually lead to productivity gains and job creation. We are on the second team, and as such believe these tools can come in handy for many purposes, including ESG strategies.
How come? For starters, if you’re just getting started with this topic, these tools can offer a wealth of curated information on ESG market trends, best practices, and regulations. You can also use this technology to identify what your peers are doing with less research time. Over time, this may help setting ESG targets, developing sustainability plans, and implementing ESG-related policies and procedures.
As ChatGPT learns more about the topic, it will eventually offer well informed insights on the countless reporting standards and frameworks now available. It can help you understand ESG reporting requirements and make recommendations on how to disclose information to stakeholders in a clear, concise, and meaningful way.
The same can be said for understanding the methodologies used by sustainability rating companies and ESG index providers (Sustainalytics, Morningstar, MSCI, ISS, RobecoSAM, DJSI, FTSE4Good, etc.). Since you can potentially have a “conversation” with ChatGPT, it might be a friendlier way to have better comprehension of those processes. This could help you boost your company’s ESG scores, or help you understand what it takes to be able to participate in sustainable finance indices (without having to hire the likes of us!).
Overall, we believe that leveraging AI’s vast access to ESG-related information and content-processing capacity, tools like ChatGPT can help you develop and implement effective ESG strategies that align with corporate values, meet stakeholder expectations, and contribute to a sustainable future. And of course, lots of other AI tools will disrupt the sustainability world as they help both investors and companies fill in some data voids, improve their data management strategies, or even continuously optimize sustainability decisions over time.
I hope you found this interesting. As usual, if there is anything we can help you with, or if there is an ESG topic you would like to know more about, please let us know.
CEO, Miranda ESG
Contacts at Miranda Partners