Measuring Companies’ Environmental and Social Impacts

An analysis of ESG Ratings and SDG Scores

Bibliographic Data

ID20413582
AuthorsJan Anton van Zanten (0000-0002-2968-6339, Robeco, Rotterdam, The Netherlands, corresponding author)
Year2025
Volume38
Issue3
Pages403-439
Publication date2025-09-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueOrganization & Environment (JOURNAL)
Journal identifiersISSN: 1086-0266 • E-ISSN: 1552-7417
PublisherSAGE Publications (PUBLISHER • US)
DOI10.1177/10860266251326895
OpenAlexW4409146884
LanguageEN
Citations received6
References cited73

Environmental, social, and governance (ESG) ratings are central to sustainable investing and research but face criticism for inaccurately reflecting corporate sustainability performance. In response, new metrics have emerged that assess companies’ impacts on the Sustainable Development Goals (SDGs). This article compares four ESG ratings with two SDG scores, revealing no correlation between them. It then evaluates the alignment between these sustainability ratings and how investors and regulators assess corporate (un)sustainability. The findings show that SDG scores capture how these stakeholders judge companies’ negative and positive impacts on sustainable development, while ESG ratings do not. This implies that SDG scores have high, and ESG ratings low, construct validity for assessing corporate sustainability performance. These results underscore that concepts like ESG, corporate sustainability, and company impact can be used complementarily but not interchangeably. The practical implication is that sustainable investors should prioritize sustainable development impacts next to avoiding ESG risks

Business · Corporate social responsibility · Political science · Public relations · Corporate Social Responsibility Reporting · Environmental Sustainability in Business · Psychology · Sustainable Supply Chain Management

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