EVALUATING THE EFFECTIVENESS OF ESG REPORTING AS A BUSINESS TRANSPARENCY TOOL IN THE CONTEXT OF GLOBALISATION

Abstract

Implementation of ESG reporting is a critical issue for ensuring the competitiveness of modern enterprises. On the one hand, it contributes to increasing investors' confidence and companies' investment attractiveness. On the other hand, using ESG standards contributes to achieving sustainable development goals and ensuring the well-being of current and future generations. At the same time, in Ukraine, the development of aspects related to ESG is only at the initial stage, which actualises the conduct of new research in this direction. The work aims to generalise the approach to preparing effective ESG reporting, considering global trends, local problems, existing standards and frameworks. Economic and statistical analysis, comparative analysis, and descriptive methods were used in the work. The work revealed the essence of ESG and noted its importance for companies and investors. The global implementation of ESG reporting as a tool for increasing business transparency is characterised. This process examined the growth of global sustainability reporting indicators since 1993 for companies on the N100 and G250 lists, as well as the level of ESG implementation by companies in Europe, North America, and the Asia-Pacific region. The key obstacles to the implementation of ESG have been studied, in particular, difficulties in the process of balancing it with the growth goals of companies, lack of clear standards and reporting rules, insufficient attention from the top management of companies, problems with determining the return on investment, imperfect legal support, etc. The priority directions for the development of regulation in the field of ESG are summarised, among which the harmonisation of standards and metrics, the development of instructions for investors, and the formation of recommendations for the objective disclosure of ESG-related risks are noted. Global ESG reporting standards and main frameworks are described. The stages of building an ESG report and the main components of an effective ESG report are summarised. The main stages of the construction of ESG reporting include the assessment of the most significant ESG issues for the company, taking into account financial and environmental aspects, disclosure of information on environmental, social and management factors, assessment of efforts and progress concerning sustainable development initiatives, determination of reporting coverage and indexing, ensuring reliability and trust. The research results can be helpful for companies seeking to implement ESG reporting in their activities and increase their investment attractiveness and level of social responsibility.