ESG (Environment, Social, Governance) Rating Scheme
An innovative service provided by the ICCPI
Transparency and credibility of information on non-financial risks, the so-called ESG (Environment, Social, Governance) will play an increasingly important role in trade and investment between Italian (European) and Philippines (Asian) companies.
The emerging regulatory framework
The European Union is introducing a relevant number of obligations to disclose non-financial information on ESG risks to allow investors, banks, buyers, and consumers to take informed decisions. These obligations are extended to enterprises in Europe and to their supply chains also non-European. For example, the Directive 2014/95 /EU requires corporate organizations to enclose a Non-Financial Statement on ESG risks to the balance sheet. An emerging Directive is going to introduce the obligation for an independent third-party assessment on ESG risks. The reference documents for these regulations are guidelines (UN, ILO, OECD) and standards (ISO 26000) internationally recognized.
In this scenario, financial institutions (investors, insurance, banks) have been making capital and loans available for some time, favoring companies with a good ESG risk profile because they ensure lower risks of unexpected costs and superior performances.
In the presence of an unregulated proliferation of voluntary declaration, the International Standardization Organization (ISO) has recently approved two important standards: ISO/TS 17033 “Ethical Claims” and ISO 17029 “General Principles and requirements for verification and validation bodies”.
Italy has been the first European country to introduce a national guideline (UNI/Pdr 102:2021) prepared by UNI (Italian Standardization Body) aligned with these two standards with the intent of defining the principles and requirements for preparing an ethical claim of responsibility for sustainable growth. An Ethical claim and label can refer to a product, a service, a process or an organization.
The process of developing an ethical claim of responsibility for sustainable development includes the three dimensions of sustainability: economic, social and environmental.
The use of such an ethical claim will enhance the demand and supply of products, services,
processes or organizations, whose characteristics stimulate a process of continuous improvement towards sustainability with the involvement of stakeholders.
For example, consumers are in a position of choosing products in an informed way, based on verified information on the sustainability and social responsibility characteristics of suppliers. The analysis process underpinning the ethical claim outlines a path which, while allowing different grades of depth and complexity, ensures the consumer, with satisfactory reliability, that the claim declared by the organization has been objectively validated/verified.
According to above mentioned ISO and UNI/Pdr, ethical claims of responsibility for sustainable development can be validated/verified provided all the 3 aspects of sustainability (economic, social and environmental) are analysed and properly evaluated.
ICMQ Certification India, subsidiary of ICMQ Group (leading Italian certification body), has developed “Get It Fair ESG Rating scheme” (www.getit-fair.com), which constitutes the first third party ethical label programme aiming to validate the claim “GIF Responsible Organization” in compliance with the international framework of rules and standard.
The GIF ESG Rating scheme, in compliance with UNI/Pdr 102:2021, applies to organizations irrespective of sector, size and location.
In this scenario the ICCPI has established a partnership with ICMQ Certification India to become “GIF ESG Rating scheme” Ambassador in Philippines of “GIF EST Rating Scheme” to fulfill two fundamentals objectives.
The ICCPI sees for its members the following benefits:
a) supporting Philippines companies to improve their competitiveness towards the Italian (and European) market (buyers, partners customers, and investors) using the leverage of the ESG risks disclosure.
b) Promoting Italian (and European) companies to create new business opportunities in Philippines.
The GIF ESG Rating Scheme applies to organizations of any sector, size, and location.