New digital data standards
In order to make ESG data comparable, new data standards are being produced and others are being consolidated. ESG data standards have typically been principle-based and qualitative in nature. However, to reduce the occurrence of greenwashing and misinterpretation, the standards are expected to move towards being rules-based with quantitative reporting metrics.
The days of unstructured reporting in narrative and using PDF formats are also ending as standards-setters take the opportunity to move to digital standards. This means computer readable standards and computer readable reports.
Digital reporting presents a challenge in terms of new technologies, even for those already with highly featured ERM and ESG solutions. There is also the opportunity to leverage the availability, usefulness and efficiency of digital standards and data.
CoreFiling allow you to gain the benefits of new digital data standards.
Digital data standards require suitable technology to succeed. The preferred technology of choice for digital reports continues to be extensible Business Reporting language (xBRL). xBRL has already delivered digitisation of tax returns, accounts, annual financial statements, prudential and statistical returns and other obligations all over the world.
Using xBRL, the data is described in a computer readable xBRL taxonomy and reports are created using computer and human readable Inline xBRL (iXBRL) format. Together, these break reporting away from the PDF documents that have been the mainstay of reporting for so long.
CoreFiling can quickly enhance your solution to support digital reporting technologies.
Traceable data can be drilled into to find out where it came from and what processing has been done to give the final number. This information is known as the data’s lineage. Executives, auditors and regulators will ask questions that require this information to answer, and so it is now a non-optional feature when handling data. With ESG, accusations of greenwashing are serious and present a massive reputational risk to a company.
Most organisations have had to retrofit their financial systems for traceability or still have black box processes or a spaghetti of data flows that can be problematic when probing questions are asked. The new data required for ESG management and reporting provides an opportunity to have data lineage as a functional requirement to make these questions trivial to answer.
Data processed by the True North data platform retains full lineage and can be easily traced back to source.
New data at the drop of a taxonomy
Perhaps the biggest economy in moving to digital data standards is the opportunity to use them to configure the data requirements for an entire system. A solution for managing US-based reporting could be quickly readied for a new market by using the digital data standard to configure it for EU-based reporting.
In order to realise this, the solution must understand the underlying technical standard to allow it to be data driven. Once this is achieved, the xBRL taxonomy defines how to present, validate and collect the required data and can completely reconfigure a solution to a new or changed data standard.
The True North data platform was built from the technical standards up, so it can be reconfigured for new markets with just a taxonomy. If one is not provided, we can generate a taxonomy from another structured representation of the data.
Writing data standards
The standards-setters taking the digital path need to be able to translate policy and research into a data model of reportable items. Similarly, companies are finding that they need their own data models to deal with the specifics of their operations and assets and own sustainability goals.
This means that data modelling may become part of the core requirements for putting ESG management in place. This should reuse external standards where appropriate and be extended to meet the granularity and breakdowns required by the company.
CoreFiling provide software and services to allow you to efficiently define new data models.
How CoreFiling can help
CoreFiling’s True North data platform provides data handling and reporting facilities for any digital data standard. This means that companies can quickly get started with new reporting or data management requirements. We track the standards and can reconfigure the solution equally quickly in case of changes.
We provide standalone and white-labelled solutions, as well as a range of integration options for existing platforms.