Energy Analytics

ESG in the Energy Industry — Embracing Change

byNick Volkmer

How did we get here and what is the challenge?

The evolution of an energy company’s environmental, social and governance (ESG) profile demonstrates the tremendous power of capital markets. In just a few years, ESG moved from a footnote on public disclosure to the forefront of investment decisions and operators’ corporate strategies, a change largely propelled by investors rather than governments.

Driving the discussion are institutes like the Principles for Responsible Investment (PRI). Nearly 3,000 firms that manage more than $100 trillion in assets under management back the PRI, a U.N.-supported initiative stating firms will incorporate ESG issues into investment analysis and decision-making processes. This does not mean the firms will base investments solely on ESG performance, but they will consider ESG aspects alongside their traditional processes. Our discussions with investors show that ESG is becoming another pillar of the decision-making process, along with asset quality and financial performance.

Why? Investors are using a company’s ESG profile to predict its resiliency to future changes. If you know how an executive team is incentivized (governance), you can properly model how the company will react to certain shocks. Quantifying a producer’s greenhouse gas footprint (environmental) will help measure how exposed it is to future regulatory changes. Analyzing a company’s demographic profile (social) can indicate the diversity of its thought process.

The challenge the market faces is that analyzing a company’s ESG profile is largely new and it is difficult to access trusted data. The market is ahead of regulation on this one – there are no generally accepted accounting principles that companies must adhere to. Investors tell companies that ESG will be factored into decisions and companies respond by voluntarily disclosing information, typically at their discretion. It is hard to cut through the smoke and really understand how two companies compare. In parallel, corporate clients position themselves as industry leaders and work to understand the ESG data landscape to ensure they set the right policies to appear favorable relative to peers.

What is Enverus’ solution?

Realizing the need emerging in our client base for integrated, normalized, quantitative data on the ESG performance of energy companies, we built Enverus ESG™ Analytics.

Enverus ESG™ Analytics is the energy industry reference for corporate ESG, providing full visibility into companies’ rankings, how they compare among their peers, and who and what are the most environmentally responsible and investible opportunities in the space.

This solution is delivered in the Prism platform and saves time by eliminating in-house data collection and providing fast analysis and benchmarking tools. The product casts a wide net, collecting the best available energy-related ESG data and distilling it down into an easy-to-digest, transparent format.

Learn more about Enverus ESG Analytics here: https://www.enverus.com/solutions/energy-analytics/ep/esg/.

Picture of Nick Volkmer

Nick Volkmer

Nick is a director of product at Enverus. He leads the product buildout for ESG and energy transition, helping the industry navigate the evolving market landscape. He joined the predecessor of Enverus in 2015 and initially focused on onshore U.S. asset valuation and optimization while leading the Gulf Coast Intelligence Team. Nick graduated from Queen’s University with a degree in engineering chemistry and earned his CFA charter in 2019.

Subscribe to the Enverus Blog

A weekly update on the latest “no-fluff” insight and analysis of the energy industry.

Related Content

risk-manager-sector
Trading and Risk
ByChris Griggs

Europe’s energy market is weathering a storm of transformations. With natural gas inventory at peak levels thanks to a diversified supply chain and falling prices, traders and analysts face an evolving challenge unlike any other.

3-deploy-wind-solar
Energy Transition
ByKevin Kang

The levelized cost of energy (LCOE) serves as a valuable measure for assessing the economic viability of a specific project or energy source.

wind-power-energy-woman-trader-stock
Energy Transition
ByCarson Kearl

Questions around the relationship of data centers to energy demand are very quickly etching themselves onto the minds of industry and technology participants alike.

Enverus Press Release - Enverus adds Energy Transition solutions around $3.5T/year sector
Power and Renewables
ByEric Palmer

Over the last seven days, the Enverus ERCOT P&R forecast has accurately predicted the 630__B constraint (KLNSW-HHSTH 138 kv with contingency DSALKLN5) in ERCOT.  While it is fundamentally driven by high wind and solar generation, there were two transmission outages...

Enverus Press Release - The surprisingly balanced global LNG market
Business Automation
ByEnverus

Being a supplier in the oil and gas business is hard. You must ride the cycle of boom and bust, differentiate yourself in an incredibly competitive market and make sure your financial fundamentals are sound.

Enverus News Release - Banking on Buzios’ oil supply
Intelligence Trading and Risk
ByEnverus

Enverus Intelligence® Research holds the position that global oil demand will not peak or decline before the end of this decade. EIR’s analysis offers a distinct and unbiased viewpoint, diverging from the two benchmarks forecasters; OPEC and the International Energy...

Enverus Press Release - From insights to injections: CCS Class VI permit applications surged 500%
Energy Analytics Energy Transition
ByGraham Bain

The Enverus Intelligence® Research (EIR) Subsurface Innovation Team attended AAPG’s CCUS 2024 conference in Houston March 11-13. The conference, which also brought together SPE and SEG membership, hyped up the need for CCUS to offset the demand for fossil fuels,...

product-knowledge
Intelligence Operators
ByErin Faulkner

E&P activity targeting the Cleveland formation in the Anadarko Basin more than doubled in 2023 with 46 new wells reaching first production, compared to 20 in 2022 and similar levels the previous two years.

summer-outlook-pjm
Energy Transition
ByRyan Notacker

Renewable fuel uptake has surged in California in recent years, contributing to a 141% increase in the California Low Carbon Fuel Standard (LCFS) credit bank surplus and resulting in a drop in credit prices from ~$185/tonne to $75/tonne from 2019...

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Sign up for our Blog

Register Today

Sign Up

Power Your Insights

Connect with an Expert

Access Product Tour

Speak to an Expert