Answering the OECD’s Call: Wikirate’s Model for Better Corporate Accountability Data

Wikirate’s unique approach to environmental and social governance data addresses key shortcomings of ESG metrics.

The new OECD report “Behind ESG ratings” dives into the world of Environmental, Social and Governance (ESG) rating systems, unpacking the challenges and developments in this space.

The report describes how the use of ESG metrics has accelerated as calls for corporate sustainability and responsibility have grown across much of society. Although the societal context is shifting, the result is that we currently have greater insight into company impacts than ever before.

That being said, the report highlighted that there are still significant challenges when it comes to this data.

First, some topics (such as corporate governance and business ethics) have much more data than others, such as impacts on biodiversity or on local communities.

Second, many ESG ratings providers use vastly different measurement techniques and standards to create their rating products, meaning that we frequently can’t compare metrics.

Thirdly, the overwhelming majority of ESG metrics are based on measuring the effort (inputs) companies are putting in rather than their actual outcomes (impacts) which means that rating products do not sufficiently capture companies’ impacts, especially along their supply chains; where, coincidentally, most human rights violations and environmental harms occur. The report found that a mere 7% of all metrics are associated with supply chain risk management.

While there is much work to be done, we’re pushing for a corporate accountability ecosystem that addresses some of these key challenges.

Building a holistic view of company impacts and commitments

We’re working to make sure that the topics identified as underrepresented in the OECD report receive equal visibility on our platform.

This is why we’re expanding the data that we have on some of the most underreported components of corporate impacts. These include sustainability, biodiversity, human rights, and corruption, among other frequently sidelined topics.

For example, we added the World Benchmark Alliance’s Nature Benchmark last year to ensure that sustainability and biodiversity are represented, and we plan to add more key datasets on biodiversity later this year.

We’re also looking to deepen our work with organisations advocating for human rights and decent working conditions to add this information to the platform as well. At the moment, our database hosts 269 different metrics covering human rights aspects.

Open and transparent data at our core

Our mission is to ensure that data on companies’ impacts on people and the planet is open and transparent so that change-makers can access it without barriers. At the same time, we want users to know where the data came from and how it was constructed. This is why we’ve created the world’s largest open-data and community-driven platform to host this information. This distinguishes us from proprietary ratings providers, as you can see the top rankings alongside the underlying data and methodologies.

We also advocate for greater transparency on company impacts more broadly. By publishing blog posts and policy briefs and running campaigns, we push for companies to be as transparent as possible and make our voice heard in the broad policy debate on corporate impacts and accountability.

Focusing on impact and working with CSOs to address issues along the entire supply chain

For true accountability and transparency, you need data on commitments and real-life impacts in companies’ operations and in their supply chains.

This data can be difficult to access, but Wikirate is pushing to collaborate more extensively with CSOs and local trade unions to improve our impact data. Nevertheless, we’re still not where we want to be.

One successful example is our collaboration with the Worker Rights Consortium, an independent nonprofit factory monitoring organisation that assesses the conditions of workers in garment facilities around the world. Since 2022, Worker Rights Consortium has been using Wikirate’s database of supply chain relationships to link global brands to the factories they investigate for labour abuses.

Another fruitful partnership is our project with the Clean Clothes Campaign on the Fashion Checker, which is made possible by the flexibility of the wikirate.org platform, ensuring the data is open, transparent, and interoperable. Our database helps to connect Clean Clothes Campaign’s reports with supply chain data, linking brands to factories and strengthening their advocacy for better working conditions.

Given that the overwhelming majority of corporate human rights violations and environmental harm takes place along companies’ supply chains, developing these kinds of projects is essential to improving our ability to measure impacts along supply chains.

More work to be done and a call for collaborations

While Wikirate’s model of openness, transparency, and impact focus is able to overcome some of the issues identified in the OECD report, we acknowledge that there is much work left to be done.

In particular, we hope to elevate and collaborate more actively with CSOs working on the ground who have knowledge on corporate impacts. We’re always looking to work together with organisations that might have data or information on how companies are impacting people and the planet.

Are you a CSO, Trade Union, research organisation, or other kind of organisation that would benefit from your data being hosted on our platform? Are you looking for help with finding or analysing data?

We’re more than happy to talk about how we can work together with you to push for corporate accountability.

Get in touch today: info@wikirate.org