International cooperation is necessary to develop the ESG standards that advisors and investors need, according to Richard Samans, director of research for the International Labour Organization and chairman of the Climate Disclosure Standards Board.

Despite the difficulty of bringing multiple countries together to agree on what environmental, social and governance standards mean and how companies should be rated, Samans said the time is ripe for such a movement to succeed.

Samans was a member of a panel discussion, “How To: Getting to Consistent, Comparable Sustainability Standards,” held yesterday and sponsored by the World Economic Forum, which dissected the possibilities of developing such standards.

ESG investing is about two decades old, but traditional regulators and standards-setting organizations were not ready for the growth of the nonfinancial aspects of investing, Samans added. Now there is a need for standards for companies across the globe to report what they are doing to advance ESG issues.

At this point in time, “there is a big opportunity” to achieve the cooperation needed, he said. “There is a convergence of energy to come up with global reporting standards to help determine the long-term value” to ESG investing, Samans said. “It is going to take time, but I am hopeful it can be done.”

Ruchi Bhowmik, global vice chair of public policy at EY (formerly Ernst & Young), agreed. She leads team that works with stakeholders on issues across audit, tax, corporate reporting and corporate governance, digital innovation, data privacy and cybersecurity issues.

“We are seeing a moment in time when we can develop the [needed] metrics and the big four accounting firms are a crucial part of this effort,” Bhowmik said.

The Securities and Exchange Commission and other regulators already have announced they will be developing human capital standards. At the same time, company boards of directors are asking how they should be upgrading reporting.

“We tell our clients, ‘Do not wait.’ The time is now to get engaged,” she added. “They should participate in the standard setting efforts because being at the table is critical. The ones who will have to implement these standards have to be at the table to make sure they are implementable.”

S&P Global Sustainable One is a company that was developed to help companies implement any reporting standards that will needed to meet ESG goals, Manjit Jus, managing director and global head of ESG research at S&P Global Sustainable One, explained.

“We’ve built our firm around creating the analytics so that our clients can meet any ESG standards” that are developed. Companies will need to be able to provide the data in a proper context so they are understandable to advisors, investors and regulators.”

The efforts to standardize ESG definitions and regulations will play into businesses’ efforts to create long-term value in their companies, said Lawrence Di Rita, who leads global public policy and environmental strategy at Bank of America in Washington, D.C.

“Investors and other stakeholders will want to be able to understand standards that are developed” and how they can affect the companies’ returns, he said. “There are no more excuses for not providing this information.”

The urgency in taking action is here now because “the regulatory landscape is shifting under our feet. Meeting ESG standards is not only going to be a best practice in the future, but it will also be a required practice,” added Samans.

De Rita said large companies, like Bank of America, will be able to meet ESG reporting standards, but smaller companies will be challenged to do so.

Bhowmik cautioned that all companies should be developing the means to measure the social and governance aspects of ESG. “The ‘E’ is easier to measure and report.” She also encouraged investors to let companies know what kind of information they want to see.