Our mission is to answer any ESG question on any company for any stakeholder. We are driven by our goal to simplify ESG reporting, saving companies time and resources while enhancing transparency, and putting an end to greenwashing. Our platform offers a user-friendly solution for employees responsible for responding to ESG surveys, by simply copying and pasting survey questions into our platform, users receive predicted answers based on publicly available data and their company ESG reports which can be uploaded. These predicted answers come with confidence ratings, alongside the evidence used to create the answer and where the evidence was found. These answers can then be reviewed before being seamlessly copied and pasted back into the ESG request, saving valuable hours that would have otherwise been spent on manual searching. EthicsAnswer allows sustainability-focused roles to improve on sustainability performance rather than just reporting on the improvements made in the past. We firmly believe that Heads of ESG time is better invested in improving ESG practices rather than being consumed by reporting on changes that have already been made by their respective company.
Our journey to our current position was not a linear one. In 2019, EthicsGrade was founded by Charles Radclyffe, a finance professional with 15 years of experience, including a role as the head of AI at Fidelity. Recognising the lack of high-quality datasets on corporate digital responsibility (CDR), Radclyffe set out to develop a solution that would enable investors to comprehend the ethical issues and risks associated with emerging technologies. Radclyffe was specifically concerned about watermelons – companies appearing green on the outside but lacking genuine sustainability practices. This led to the birth of EthicsGrade, which provided the world’s first dataset on digital ethics, featuring a robust model encompassing over 300 questions and offered investors tailored scores of their fund assessments through their own lenses, aligning their investments with their ethical priorities.
During the initial years at EthicsGrade, our primary focus revolved around data analysis of AI as an ESG issue. We established publicly available baseline ratings for companies based on public data, this also highlighted their transparency. Subsequently, companies would utilise our survey platform, InsideView, to provide private data which further illuminated their ESG practices, and the two scores culminated in a CDR benchmark scorecards.
In late 2022 EthicsGrade was thrilled to join ABN AMRO + Techstars Future of Finance Accelerator, having previously graduated from Nasdaq’s ESG-focussed accelerator programme in December 2021 and LHoFT Kickstarter Catapult earlier in 2021. Our experience at TechStars was instrumental in shaping our understanding of the needs and challenges surrounding ESG surveys. Through in-depth conversations with industry-leading companies, we recognised that the approach we initially pursued, aiming for the simplest disclosure process while creating the best ESG survey, did not align with their actual requirements. It became clear that if our goal was to uncover “watermelons” and drive significant ESG improvements, we had to address the broader issue of information disclosure to all requests.
Recognising the inherent challenge and burden of ESG surveys, we embarked on an updated mission to simplify the process. We began developing a machine learning engine that streamlined our own survey, making it more user-friendly for companies. We also leveraged our prediction engine, by presenting only the 60 most relevant questions out of our comprehensive set of 300 and implementing pre-filled answers, reducing the effort required and enabling companies to focus on reviewing and confirming answers rather than providing information.
After recognising the success of implementing pre-filled answers in our surveys with our prediction engine, we now leverage the technology to offer a consumer-facing platform capable of answering any question about any company for every investor. Our platform, EthicsAnswer, is now poised to address the challenge we first set out to solve in 2019, namely the overwhelm of ESG surveys faced by companies and the data gap for all investors seeking comprehensive ESG information.
We started this year with the hypothesis that we could help companies reduce their ESG risks by providing more granular and complete data from having a better ESG survey. What we’ve learned is that what companies need is a better solution to answer ESG surveys. And our prediction engine is exactly that.
Through market research, we have confirmed that individuals with sustainability-focused roles, specifically Heads of ESG, face issues in meeting ESG reporting requirements. Filling in ESG reports is an issue as its demands are often unable to be met within the time available. Often answers to the ESG request involve multiple departments whose input elongates the process further. The need for support on ESG surveys is compounded by a current disparate data collection process as well as an inefficient reporting process that is costing many hundreds of thousands of euros each year in departmental inefficiency and company-wide risk.
It has become clear that we are able to provide a platform which would be a unified system powered by AI. We recognised that it would be valuable for Heads of ESG to have a centralised system, a database of ESG information, to simplify the process, save time and provide a structure to their disclosure efforts. Our solution provides users with a service whereby they can write any ESG question and be provided with an answer, rather than pulling data from multiple sources about disclosure commitments.
By tackling the information-sharing and transparency issues in reporting, we provide investors with a clearer and more holistic understanding of ESG. Our platform aims to support Heads of ESG by offering the tools and resources they need to navigate the complex landscape of sustainability reporting. With EthicsAnswer, we are paving the way toward a more informed and sustainable investment ecosystem.
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EthicsGrade will continue our pursuit to answer any ESG question on any company for any stakeholder.