ESG frameworks are structured systems used to measure, manage, and report information related to environmental, social, and governance performance. ESG stands for Environmental, Social, and Governance—three areas that describe how organizations interact with the environment, society, and internal management practices.
These frameworks exist to bring consistency and clarity to sustainability reporting. As organizations began sharing information about emissions, labor practices, and governance structures, reports often lacked standard definitions and metrics. ESG frameworks were developed to solve this problem by offering clear guidelines on what should be reported and how it should be presented.
Today, ESG frameworks are widely used across industries to improve transparency, comparability, and accountability in non-financial reporting. Among the most widely referenced frameworks are ESRS, GRI, and SASB
Importance: Why ESG Frameworks Matter Today
ESG frameworks matter because non-financial risks and impacts increasingly influence economic performance and long-term stability. Climate risks, supply chain practices, data protection, and board oversight now affect decision-making at every level.
Key reasons ESG frameworks are important include:
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They help organizations identify environmental and social risks
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They improve data quality and consistency in sustainability disclosures
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They support responsible decision-making for investors and stakeholders
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They align sustainability goals with business strategy
These frameworks affect a wide range of groups:
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Public and private organizations
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Investors and analysts
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Regulators and policymakers
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Employees and communities
Without standardized ESG frameworks, sustainability information would remain fragmented and difficult to compare across sectors and regions.
Overview of Major ESG Frameworks
Different ESG frameworks serve different reporting needs. The table below summarizes the focus areas of ESRS, GRI, and SASB.
| Framework | Primary Focus | Main Audience | Reporting Scope |
|---|---|---|---|
| ESRS | Regulatory sustainability disclosure | Regulators, capital markets | Environmental, social, governance |
| GRI | Impact on economy, environment, society | Public stakeholders | Broad sustainability topics |
| SASB | Financial materiality | Investors | Industry-specific ESG risks |
ESRS Explained: European Sustainability Reporting Standards
ESRS is the sustainability reporting framework developed under the European Union’s Corporate Sustainability Reporting Directive (CSRD). It is designed to standardize ESG reporting for organizations operating within or connected to the EU.
Key characteristics of ESRS include:
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Mandatory reporting for covered entities
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Double materiality assessment
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Detailed environmental and social disclosures
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Alignment with EU climate and sustainability goals
ESRS emphasizes both:
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How sustainability issues affect organizational performance
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How organizational activities impact society and the environment
GRI Explained: Global Reporting Initiative Standards
GRI is one of the most widely used global ESG reporting frameworks. It focuses on transparency around an organization’s impact on the economy, environment, and people.
Key features of GRI standards include:
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Global applicability across industries
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Stakeholder-focused reporting
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Topic-specific and sector-specific standards
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Emphasis on impact materiality
GRI is often used by organizations seeking broad sustainability communication rather than purely financial ESG analysis.
SASB Explained: Sustainability Accounting Standards Board
SASB standards focus on sustainability topics that are financially material to an organization’s performance. These standards are industry-specific and designed primarily for capital market participants.
Important aspects of SASB include:
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Industry-based metrics
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Investor-focused disclosures
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Financial risk relevance
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Quantitative performance indicators
SASB standards are now maintained by the IFRS Foundation and aligned with international financial reporting initiatives.
Recent Updates and Global Trends in ESG Frameworks
Over the past year, ESG frameworks have undergone significant changes to improve alignment and reduce reporting complexity.
Key developments include:
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In January 2024, ESRS became mandatory for large EU entities under CSRD
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In July 2024, the IFRS Foundation continued integration of SASB standards into the ISSB framework
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In October 2024, GRI updated selected topic standards related to labor and human rights
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Growing global alignment between ESRS, GRI, and ISSB standards throughout 2024–2025
A major trend is interoperability, where frameworks are increasingly designed to work together rather than compete.
Laws and Policies Affecting ESG Frameworks
ESG frameworks are increasingly shaped by national and regional regulations.
Key regulatory influences include:
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European Union: CSRD mandates ESRS reporting for qualifying organizations
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United States: SEC climate disclosure rules influence ESG data quality
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India: Business Responsibility and Sustainability Reporting (BRSR) aligns with ESG principles
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Global: ISSB standards support cross-border sustainability reporting
These policies encourage consistent ESG disclosures and reduce reporting gaps across jurisdictions.
Tools and Resources for ESG Reporting
Organizations often use digital tools and reference platforms to apply ESG frameworks accurately.
Helpful resources include:
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Official ESRS documentation from EU authorities
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GRI Standards online platform
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SASB industry standards database
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Materiality assessment templates
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ESG data management dashboards
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Sustainability reporting checklists
These tools help standardize data collection, reporting workflows, and compliance processes.
Common ESG Framework Comparison Table
| Feature | ESRS | GRI | SASB |
|---|---|---|---|
| Regulatory driven | Yes | No | No |
| Industry specific | Partial | Limited | Yes |
| Investor focus | Medium | Low | High |
| Impact reporting | High | Very high | Medium |
Frequently Asked Questions
What is the main purpose of ESG frameworks?
ESG frameworks provide standardized guidance for reporting environmental, social, and governance information clearly and consistently.
Are ESG frameworks mandatory?
Some frameworks, such as ESRS, are mandatory under specific regulations, while others like GRI and SASB are voluntary.
Can organizations use more than one ESG framework?
Yes. Many organizations combine frameworks to meet regulatory requirements and stakeholder expectations.
What is double materiality in ESG reporting?
Double materiality considers both financial risks to the organization and the organization’s impact on society and the environment.
How often are ESG standards updated?
Most ESG frameworks are reviewed and updated annually or when regulatory or market changes occur.
Conclusion
ESG frameworks play a critical role in improving transparency, accountability, and consistency in sustainability reporting. ESRS, GRI, and SASB each serve distinct but complementary purposes, supporting regulatory compliance, stakeholder communication, and financial analysis.
As sustainability expectations continue to evolve, alignment between ESG frameworks is increasing. Understanding how these frameworks work helps organizations and stakeholders interpret ESG information accurately and make informed decisions in a rapidly changing global landscape.