Which is the correct order for developing an ESG scorecard?

The correct order for developing an ESG scorecard involves a systematic approach that ensures all critical elements of the process are covered effectively. Starting by identifying items provides a foundational understanding of what specific areas or criteria will be assessed within the ESG framework. This initial step ensures that all relevant environmental, social, and governance factors are considered.

Following that, breaking down issues allows for a more detailed examination of each identified item, ensuring that the complexities and nuances of each ESG factor are understood and appropriately dealt with. This step is crucial for accurately evaluating the aspects that may impact the overall ESG performance of a company.

Determining scoring is the next logical step, as it establishes how each item and issue will be quantified in terms of performance. This scoring system provides clarity on what constitutes good or poor performance on various ESG criteria.

Next, assessing scores involves evaluating how a company performs across the determined ESG items, collecting data, and applying the scoring systems designed earlier. This assessment is vital for understanding the company's current standing in relation to its peers and the ESG benchmarks established.

Calculating aggregated scores is important for synthesizing the individual scores into a comprehensive measure of ESG performance, which can then inform investment decision-making.

Finally, benchmarking against similar organizations or industry standards helps contextualize a company's