- Matthieu Maurin
- Co-Founder and CEO, Iceberg Data Labs
- Sara de la Torre
- Head of Banking, Financial Services and Insurance, Dun & Bradstreet
- Tom Alford
- Deputy Editor, Treasury Management International
Weaving ESG into Everyday Treasury
ESG is increasingly a core part of doing business today, and many corporates have established programmes to ensure they are meeting the related requirements of all stakeholders. Here, we explore how ESG can successfully be made part of daily treasury life.
The component strategies of ESG are no longer a ‘nice-to-have’; they are now fundamental risk mitigants for business operations, states Sara de la Torre, Head of Banking, Financial Services and Insurance, Dun & Bradstreet (D&B). “As a key risk concern, ESG is transforming the entire financial system,” she notes. “Because treasurers interact daily with capital providers, if, as is increasingly likely, their organisations have serious ESG strategies, those treasuries know they must align their actions with those strategies.”
And yet that task is rarely easy. Historically, the siloed nature of many businesses means inter-functional (and inter-entity) sharing of data has prevented many businesses from embracing what de la Torre refers to as the “holistic approach to ESG”. Without that connection, she argues, it is almost impossible to engage every stakeholder, subsequently diminishing the reach and efficacy of corporate ESG objectives.
The issue for many treasurers though is that they do not have the time nor resources at their disposal to engage with transformational data management projects at this level. “They have many competing daily priorities,” accepts de la Torre. “And if they possess only a limited understanding of how ESG relates to their work, I can see why they might not bother.”
There is also an element of risk to tackle. Greenwashing of financial products is still perceived to be an issue, says de la Torre (See Box 1). And while concerns persist around the reputational impact of trade with certain companies or sectors, without supporting data to make decisions, it’s difficult to assess the potential impact of ESG-driven supply chain adjustments.
Continuing journey
Clearly, the easier availability of accurate and timely data would help deliver a more successful approach to ESG. But the necessary structural changes to achieve this require senior management sponsorship, observes de la Torre. “When an ESG-focused culture has support from the top, it encourages cross-departmental collaboration, not just on data sharing but also on ensuring each function understands and appreciates the others’ ESG perspectives.”
Indeed, broad-based stakeholder communication is essential if the right data is to be sourced and shared. However, the necessary reach for that data is likely to extend beyond the business because ESG is a global and limitlessly dynamic concern. “It’s why companies have to start looking at ESG as a journey rather than an end-goal,” cautions de la Torre. “That means leveraging diverse participants and data sources for distinct purposes – nobody offers a single ‘golden key’ that can fix it all.”
Easier path
While multiple data sources can offer companies improved ESG-led insight into their day-to-day activities, at the data-user level there is a risk of generating unmanageable inflows. In treasury terms, piling more work onto already stretched resources would be undesirable.
That pressure could be eased if only the most appropriate data were obtained. But it’s not necessarily the treasurer’s job to filter the world’s vast ESG data resources. This is where technology has a significant role to play. In addition to Iceberg Data Labs’ ESG reporting tool (See Box 1), an increasing number of dedicated tools are available.
TMI recently reported on Scientific Portfolio’s platform. This is an independent and neutral solution with academic roots (through the French business school EDHEC) designed to deliver only what data is needed into each user-scenario to help manage financial risks, and the performance and ESG and climate characteristics of equity portfolios. The vendor sources its own raw data wherever possible, applying in-house analytics to ensure it has full data transparency.
D&B’s ESG Intelligence platform hosts the largest volume of non-aggregated data on corporates globally. It provides an impartial view of all the hierarchies, connections, and activities across these entities. This aids ESG compliance – both at a strategic and regulatory level – enhancing user ability to assess which companies best meet supply-chain-partner criteria, from a credit and reputational risk standpoint.
By deploying appropriate technologies, treasury is able to free itself from the manual effort of sourcing and processing ESG data. Then, armed with the right mindset, it can begin moving beyond seeing ESG as a passive reporting task, developing instead a more proactive response.
As de la Torre explains: “It’s fundamentally important now that treasury is able to use ESG as a core part of its credit strategy. And it is also vital that it has the knowledge and capacity to explain that approach, and its advantages, to bank relationship managers, investors and other key stakeholders”.
Learning to lead
Personal education will be key in developing the treasury function’s outlook, suggests de la Torre. In addition to taking an academic approach – the online Cambridge University sustainable finance course being one respected example in this field – she urges treasurers to consider leveraging the educational and social resources of their national treasury associations. “ESG is a rapidly evolving space, and knowledge is often best acquired and shared through collaboration.”
The opportunity to learn should not be missed as there is now a clear link between ESG and profitability drawing treasury deeper into this space. EY-Parthenon, for example, notes that “ESG factors have been found to be positively correlated with financial performance and attractiveness to investors”.
Its report, How companies can link ESG to long-term value, indicates that the growing volume of investment cash looking for genuine sustainability leaders can, among a currently limited pool, “result in a lower cost of capital for companies that embrace ESG and demonstrate tangible success”. It’s a compelling argument, and one that de la Torre maintains “is where we will start seeing the role of treasurer becoming more dynamic and powerful”.
BOX 1: Wash and go: Why low-quality datasets are undermining ESG investing
Increasingly, stakeholders, including treasurers, are demanding greater accountability from FIs about the impact of their portfolios on the environment. But greenwashing still presents a serious obstacle for some investors. Matthieu Maurin, Co-Founder and CEO, Iceberg Data Labs, offers actionable insight into the world of ESG data.
There is a massive amount of information and data available in the green finance space – perhaps too much. To what extent do you believe stakeholders are now able to discern fact from fiction?
It is true that, contrary to common belief, we do not lack data. On the contrary, we have an abundance of it. What is missing, however, is standardisation and accountability. This results in data that is not comparable, and raises concerns about data quality.
For example, consumer electronics companies that publish comprehensive climate reports factoring in their downstream impact, such as electricity consumption and the operational life expectancy of devices, which account for more than 90% of their impact, are the exception rather than the norm. This leads to misleading benchmarks when comparing them with their sector peers. This lack of standardisation and accountability presents major challenges for FIs attempting to accurately assess the impact of consumer electronics companies.
To what extent is greenwashing still an issue today, and what is your assessment of the damage it has done to the green-finance industry?
Greenwashing remains a significant concern, which is evident when examining the constituents of so-called ‘low-carbon’ funds – where, for instance, manufacturers of sports cars can still be found. This undermines the credibility of sustainable investors, and the standards meant to guide them.
This is precisely why, over the past year, regulators have taken steps to move beyond mere reporting obligations and impose greater accountability on the sponsors of such funds.
To what extent are stakeholders more attuned to the threat of greenwashing these days, and how far has this led those that wish to deceive to become more sophisticated in their approach (or, among stakeholders, made them so cynical they believe very little of what’s claimed by FIs)?
In our experience, the issue does not lie with FIs, which can work only with the data available to them, but rather with the lack of data standardisation and accountability. As long as it remains acceptable to ignore Scope 3 impacts, for instance, or selectively curate reported data to correct obvious misrepresentations, why would the market invest in better data solutions or engage with issuers to improve their reporting?
On the other hand, the increasing weight of passive investment and ‘automatic rules’ underlines the need to strengthen standards. For example, we recently saw a major EU blue-chip company halve its reported carbon intensity simply by reclassifying part of its business under Scope 3. As AUM in sustainable index funds continues to grow, investors and regulators must remain highly aware of the potential for ‘gaming’ environmental performance. This issue is enabled by incomplete or unverified datasets.
Do some companies inadvertently mislead, or is greenwashing always a conscious effort to deceive?
In our experience, it is mostly due to poor data quality and lack of oversight, which makes the cost of errors more acceptable than the cost of penalties. This needs to change in order to address the most egregious examples, such as the exclusion of Scope 3 emissions (both upstream and downstream) in low-carbon funds.
Are there any laws against greenwashing, and are these rigorously applied?
Yes, the EU’s European Securities and Markets Authority (ESMA) has published guidelines on fund naming to reduce misrepresentation in fund selection policies. We expect to see funds fined based on this regulation in the coming months.
Similarly, several regulators worldwide, including those in the US and Australia, have imposed fines on asset managers for misrepresenting their ESG policies.
How can treasurers better arm themselves against greenwashing?
Treasurers should be much more demanding of data and information providers, particularly when it comes to governance. They should ask whether providers are involved in both advisory and analysis – something that will no longer be allowed under ESMA regulations set to be enforced in 2026 – and how they manage conflicts of interest.
It is also important to assess whether they have scientific governance in place and whether they regularly update their models. In addition, all stakeholders should question whether providers rely solely on reported data, or if they actively verify its quality and normalise it.
Last but not least, I always recommend applying a ‘smell test’ to the data. If a dataset fails to flag sports car manufacturers or pesticide producers as concerning issuers, or if it relies only on a tick-box approach based on company PR rather than quantified performance, then it is probably not reliable enough to guide capital allocation.
Iceberg Data Labs develops metrics and tools aimed at helping FIs manage their environmental impact, including Scope 1, 2 and 3, upstream and downstream reporting. Its reporting is aligned with Task Force on Climate-Related Financial Disclosures (TCFD) and Taskforce on Nature-related Financial Disclosures (TNFD), EU Sustainable Finance Disclosure Regulation and Taxonomy, and Article 29 of France’s Energy and Climate Law.
Real-world solutions
The proof of how effective ESG strategies can be is illustrated by the winning entries in the Best Sustainable Finance Project category of TMI’s 2025 Treasury4Good Awards. Here’s an overview of each project.
Incentivising supplier sustainability
Covering 18 buying entities and more than 100 suppliers across EMEA, Sun Chemical’s 2025 gold-award-winning sustainable supplier finance programme is designed to reduce Scope 3 emissions by 13.5% by 2030 while optimising working capital. By incorporating a tiered pricing structure linked to EcoVadis sustainability ratings, Sun Chemical – one of the world’s largest producers of printing inks and pigment – is incentivising suppliers to adopt responsible practices, strengthening environmental performance across its supply chain.
Its supplier-finance programme is designed to meet both sustainability objectives and operational needs. A thorough supplier analysis carried out by the company revealed that 50% of spending was concentrated among a few hundred suppliers. This helped drive the decision to engage a wide range of external partners and exclude intra-group suppliers from the programme.
A phased implementation strategy ensured minimal disruption and smooth supplier onboarding. A dedicated project team worked closely with these to address concerns, facilitate training, and align them with the programme’s objectives. Collaboration between the treasury and procurement teams at Sun Chemical was instrumental in ensuring financial goals were balanced with sustainability commitments.
Crucially, local regulations and restrictions on payment terms were carefully considered to ensure compliance while minimising disruption to domestic cash flows. This strategic approach enabled Sun Chemical to deliver a solution tailored to the diverse regulatory environment across EMEA.
The programme provides an alternative liquidity solution for onboarded suppliers by leveraging the creditworthiness of Sun Chemical. It offers suppliers favourable financing terms while improving the company’s working capital management through extended payment terms.
Managing 80% of supplier spending through the EcoVadis platform enables Sun Chemical to incentivise its suppliers to improve performance across four sustainability criteria: environment, ethics, labour and human rights, and sustainable procurement. This approach delivers measurable improvements in sustainability across the supply chain while reducing Scope 3 emissions. The increased transparency and visibility the programme provides has also strengthened relationships between Sun Chemical and its supplier base.
Powering the world, for the long run
The 2025 silver-award winning global smart energy solutions provider, China-based Chint, is making significant strides in Europe’s renewable energy sector with a major solar project in Portugal. To realise its vision, the firm required a complex and large-scale bank guarantee (BG) solution to meet the stringent requirements of local grid operators.
Securing the committed €420m syndicated BG facility involved navigating a series of financial, regulatory, and operational complexities. The size of the guarantees needed was substantial, and the long-term nature of the project – spanning nine years – added another layer of intricacy. In addition, regulatory differences between China and Europe required careful alignment, as did tax frameworks and the operational requirements of a diverse group of banks. For example, Portugal’s grid operators required that guarantees come from investment-grade European banks, with strict, non-negotiable templates governed by Portuguese law.
The syndicate included banks ranging from Chinese state-owned institutions to European commercial banks, each with different risk appetites and ways of operating. Bridging these financial, legal, and cultural differences was a major challenge that saw Standard Chartered step in as the sole mandated lead arranger and structuring partner.
The bank developed a dual-level structure that connected Chinese and European banking partners. Through this syndicated BG facility, Chinese banks issued counter guarantees to European fronting banks, ensuring the guarantees met local requirements while tapping into market appetite in both regions. Standard Chartered also played a key role in structuring the documentation, ensuring regulatory compliance, and co-ordinating between the different banking entities. This approach not only provided Chint with the financial backing required but also created a scalable model for future solar projects.
The facility enables Chint to continue its expansion in Europe while supporting Portugal’s National Energy and Climate Plan, which includes ambitious targets for reducing greenhouse gas (GHG) emissions and increasing renewable energy capacity.
The success of this financing arrangement means Chint can develop 5.5GW of new solar capacity in Portugal, a vital contribution to the country’s energy transition. Moreover, this project aligns with Portugal’s climate objectives, including a significant reduction in GHG emissions by 2030. Beyond the immediate benefits for Chint, the transaction demonstrates increasing confidence among investors in the potential for collaboration between Chinese and European FIs in the renewable energy sector.
Carbon-neutral consumption
A key supplier in the consumer electronics sector, TMI 2025 bronze-award winner, Luxshare Precision Industry (Luxshare) is dedicated to reinforcing its commitment to sustainability, embedding environmental targets into its financial strategy and commitment to achieving supply-chain carbon neutrality by 2030.
Consumer electronics is an industry where supply chains are under increasing pressure to reduce their environmental impact. The company has long since aligned its ESG approach with the United Nations Sustainable Development Goals (UN SDGs), but this latest move represents a fundamental shift, tying financial incentives directly to sustainability performance.
In Q3 2023, the business began discussions with banking partner Standard Chartered to introduce a financing agreement that links lending rates to environmental performance. By May 2024, this agreement was formalised, embedding sustainability-linked targets into Luxshare’s receivables financing. The revised structure ties financing terms to two key environmental metrics: the proportion of clean electricity used and the percentage of waste that is recycled or repurposed. In turn, these KPIs align with the company’s long-term sustainability goals and the expectations of its customers and partners.
The first official measurement of Luxshare’s progress, planned for April or May 2025, will assess whether the company has met its sustainability-linked performance targets. The firm also set a milestone of reaching 50% clean electricity usage by the end of 2025. Likewise, its waste transformation ratio target of 88% in 2024 is expected to rise to 90% by 2025.
These commitments contribute to global sustainability efforts, particularly UN SDG 7 (Affordable and Clean Energy), SDG 12 (Responsible Consumption and Production), and SDG 13 (Climate Action). Instead of applying generic green finance labels, Luxshare’s model directly connects its sustainability efforts with financial outcomes. Meeting these targets enables the company to access more favourable financing rates, and strengthens its relationships with key partners, ensuring that its environmental progress delivers both operational and economic value.
