Once a manufacturer has completed its materiality assessment (identifying the most significant environmental, social, and governance issues for the business and its stakeholders) and established a base year (a fixed point of reference for tracking progress), the next crucial step is structuring the ESG (Environmental, Social, Governance) report. The ESG report serves as the primary tool for transparently communicating performance, risk management, and value creation to investors, customers, and employees. An effective report integrates strategic narrative with specific, quantifiable data across the three ESG pillars we defined in “Key Categories for ESG Goal Setting in Manufacturing” In this article, we will explore a basic format for an ESG report.  The Standard Report Structure A manufacturer's ESG report generally follows a clear hierarchy designed for strategic communication and easy access to data:

1. Executive Summary and Strategic Context

• CEO/Leadership Statement: This outlines the integration of ESG into the core business strategy, references the materiality focus areas, and highlights key achievements against the base year performance.


• Company Profile & Reporting Scope: Defines the organization, its production footprint (e.g., specific plants/regions covered), and explicitly states the base year chosen for all metric comparisons.


• Materiality Matrix & Strategy: A visual or detailed explanation of the prioritized ESG topics, ensuring the rest of the report focuses on these areas (e.g., supply chain ethics, operational efficiency, or GHG reduction).


• Framework Alignment: Identifies the reporting standards used which informs the selection and presentation of metrics in the subsequent sections. Some of the various standards and frameworks used for ESG reporting include the Sustainability Accounting Standards Board (SASB), the Global Reporting Initiative (GRI), the Task Force on Climate-Related Financial Disclosures (TCFD), and the International Sustainability Standards Board (ISSB).

2. Key Data and Metrics by ESG Pillar

The core of the report is the detailed disclosure across the three pillars, driven by the specific operational risks and resource intensity inherent in manufacturing. All quantitative metrics in these sections must clearly indicate performance compared to the base year data. Environmental (E) Metrics: Efficiency and Climate The "E" pillar is dominated by resource consumption, waste, and emissions—areas where manufacturers have a measurable, material impact. This area tends to have the most standardization regarding measurement. Be sure to use a measurement that is acceptable to your reporting framework.

• Climate & Emissions: Disclosure must include Scope 1, 2, and 3 GHG Emissions (in absolute tonnes), tracked and compared against the base year data to show reduction or increase. Crucially, the Emissions Intensity ($tCO_2e$ per unit of production) must be reported to show efficiency improvements. The report should also include the Percentage of Energy from Renewable Sources, demonstrating the rate of transition from the base year’s energy mix.


• Resource Efficiency: Report on the Total Energy Consumption (MWh or GJ) and the percentage change from the base year. For water, disclose Water Withdrawal and Discharge (in cubic meters), comparing the current volume to the base year, especially for operations in water-stressed areas.


• Waste & Circularity: Detail the Total Waste Generated (in tonnes), separating Hazardous vs. Non-Hazardous waste, and comparing volumes against the base year. The Waste Diversion/Recycling Rate (%) measures the improvement in circularity, while the Percentage of Recycled/Sustainable Input Materials shows progress in sustainable sourcing since the base year.

Social (S) Metrics: People and Supply Chain For global manufacturers, the "S" pillar is defined by employee well-being and the ethical oversight of complex, multi-tiered supply chains.

• Employee Health & Safety: These are critical metrics. The report must feature the Total Recordable Incident Rate (TRIR) (Injuries per 200,000 hours worked) and the Lost Time Injury Rate (LTIR), both benchmarked against the base year rate to track safety improvement and injury severity.


• Labor Practices: Include the Employee Turnover Rate (%), compared to the base year to identify significant changes in labor stability.


• Supply Chain Standards: Disclose the Percentage of Critical Suppliers Audited for Labor Practices/Human Rights to demonstrate the growth in due diligence efforts since the base year. The report should also track the absolute Number of Critical Supply Chain Violations in the reporting year.

Governance (G) Metrics: Oversight and Integrity Governance ensures the structures and incentives are in place to effectively manage ESG risks and opportunities across the manufacturing operation. Typically written documentation is required to support the integrity of this section. Documentation can include, but is not limited to Employment Policies, Ethics Policies, Safety Policies and Records, etc.

• Oversight & Risk: The report should detail Board-level ESG Competence/Oversight, describing the board committee structures and the frequency of ESG risk reviews, confirming that sustainability is a strategic priority.


• Executive Compensation: Specify the Percentage of Executive Compensation Linked to ESG Targets, showing alignment between pay and achieving material goals (e.g., carbon reduction targets set relative to the base year).


• Ethics & Compliance: Track the Confirmed Incidents of Corruption or Bribery and the Hours of Ethics/Compliance Training Per Employee, measuring the investment in a culture of integrity across all manufacturing sites.

3. Goals, Targets, and Assurance

The final section ties the data back to strategy and prepares the report for stakeholder scrutiny.

• Targets and Future Commitments: Clear articulation of short-, medium-, and long-term targets (e.g., "Achieve 50% carbon reduction below base year levels by 2030").  To demonstrate genuine commitment and avoid the perception of "greenwashing," a company's ESG targets should be meaningfully ambitious, stretching beyond simple compliance or easily achievable operational improvements.


• Risk and Opportunity: Discussion of how climate change, resource scarcity, and social issues create financial risks and opportunities for the manufacturing business models.


• Independent Assurance: Disclosure of whether the reported data (especially GHG emissions and safety metrics) has been verified by an independent third party, lending credibility, and integrity to the entire report.

This structured approach, anchored by the materiality assessment and the base year data, allows a manufacturer to provide a coherent, data-driven, and trustworthy account of its sustainability performance. Once your foundational first year report is completed, subsequent annual reports will be required to demonstrate progress or changes made to reach the targets.