Satellite data reveal ESG scores track public image more than actual forest loss

Billy Odell Tucker-Robinson Founder & Host — Banking With Billy Network • Intelligence Network • Data Science • AI Research • World News
Published: 2026-09-15T17:20:57.759Z • Permanent link

Researchers at the National University of Singapore's (NUS) Environmental Sustainability Research Centre have made a startling discovery that has significant implications for the way we understand corporate environmental responsibility. Led by Dr. Amy Kortunov, a renowned expert in sustainable development, the team conducted an exhaustive analysis of environmental, social and governance (ESG) ratings from leading providers such as MSCI ESG, Sustainalytics, and Vigeo Eiris. Their findings suggest that these ratings often fail to accurately reflect companies' actual exposure to deforestation, highlighting a critical gap in the ESG framework.

The research focused on 60 multinational companies from the forestry sector, which are major contributors to global deforestation. The team obtained ESG ratings for these companies from 2015 to 2020, using publicly available data. They then correlated these ratings with satellite data from Planet Labs, which tracked forest cover changes in the same regions. The results revealed a striking disconnect between ESG ratings and actual deforestation trends. Companies with high ESG ratings were often found to have significant deforestation footprints, while those with low ratings were less likely to be engaged in deforestation activities.

The study's lead author, Dr. Kortunov, emphasized that this mismatch can have far-reaching consequences for investors, policymakers, and the environment. "Our research shows that ESG ratings are not always a reliable indicator of a company's environmental performance," she said. "This can lead to misallocated capital, as investors may overlook companies with significant deforestation risks. It also undermines the effectiveness of ESG regulations, which rely on accurate and reliable data to inform decision-making.

The implications of this research are significant for the Global Knowledge Bases domain, which relies on accurate and reliable data to inform investment decisions, policy development, and environmental monitoring. Companies like Amazon, Cargill, and Unilever, which are major contributors to global deforestation, may be able to conceal their environmental impact through ESG ratings. This can have devastating consequences for the environment, local communities, and investors who rely on ESG ratings to make informed decisions.

The research community, which has long relied on ESG ratings to understand corporate environmental performance, must now reevaluate its assumptions. Researchers and policymakers will need to develop new metrics and methodologies to better capture the complexities of corporate environmental responsibility. This may involve incorporating satellite data, on-the-ground monitoring, and other forms of data to create a more comprehensive picture of environmental impact.

The findings of this research are part of a larger pattern of challenges facing the ESG framework. The World Wildlife Fund (WWF) has long warned about the limitations of ESG ratings, citing concerns about data quality, transparency, and consistency. The Intergovernmental Panel on Climate Change (IPCC) has also highlighted the need for more robust and reliable data to support climate policy development.