Sustainability ratings for SMEs

Companies don’t get very far paying mere lip service to sustainability. This is because new legal frameworks make sustainability reports necessary, based on the motto "Trust is good, control is better." In Switzerland, for example, larger companies must comply with the indirect counter-proposal to the Responsible Business Initiative. This year, for the first time, they have to report their conduct in areas such as the environment, social affairs, labor and human rights – and how they measure their efforts. The Federal Council wants to tighten the rules and extended reporting obligations will apply within the EU from 2024.

While the rules don’t directly target SMEs just yet, they do have an impact on supply chains. Major customers require their suppliers, who are often Swiss SMEs, to submit recognized sustainability reports. If a supplier cannot do this, they can expect to lose customers and they also have no chance of winning a call for tender.

Although SMEs are striving hard for sustainability, the regulatory environment is still increasingly challenging. On the one hand, SMEs are spoiled for choice by a raft of very different rating and reporting tools. On the other hand, extended reporting is a major bureaucratic hurdle for many SMEs with scarce resources. esg2go simplifies this mammoth task enormously: with this practical tool, companies with four or more employees receive a meaningful sustainability rating with just a few clicks. The online tool was created by the Center for Corporate Responsibility and Sustainability (CCRS), which is associated with the Freiburg University of Applied Sciences, in cooperation with SMEs and supported by well-known partners such as UBS.

The abbreviation ESG in the name esg2go stands for three aspects of sustainability or sustainable development: Environment, Social and Governance. The simple, easy-to-use platform enables SMEs to quantify their position and measure the risks the company is taking in the three ESG fields. Both financial and non-financial data are taken into account, both in terms of the environmental footprint (pollution of the environment) and how the SME contributes towards sustainability in general. The information is automatically checked for plausibility and then incorporated into a rating report.

As a seal of approval for the correctness of the data entered in the tool, SMEs can also apply for their own esg2go label, which is awarded by the Swiss Association for Quality and Management Systems (SQS) in accordance with a multi-stage verification process. As SQS explains on its website, “esg2go is a solid benchmarking tool because it makes industry-specific sustainability performance quantitatively measurable and comparable. It integrates international standard reporting, which saves on transaction costs.” These include, for example, GRI (Global Reporting Initiative), EU Taxonomy or DNK (German Sustainability Code).

esg2go has now been on the market for a year and is supported by UBS, among others. Our involvement underlines our commitment to the sustainable development of the economy and society. We asked companies from a wide range of industries about their use of esg2go. You can read some of their answers below.