Environmental, social and governance [ESG] consulting model

Trentin, Luciano; Marques, Moacir

doi:10.5902/1983465989246

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Original Article • Rev. Adm. UFSM 18 (1) • Apr 2025 • https://doi.org/10.5902/1983465989246 linkcopy

Environmental, social and governance [ESG] consulting model

Modelo de consultoria em ambiental, social e governança [ESG]

Authorship SCIMAGO INSTITUTIONS RANKINGS

Purpose This study proposes to develop a consultancy model to evaluate the level of maturity of ESG practices.

Design/Methodology/approach Business Model Canvas [BMC] as a framework for creating a business model focusing on Environmental, Social, and Governance [ESG] consultancy services. A five-level maturity scale was applied to the dimensions that characterize the diagnostic checklist model for ESG practices. The Delphi research method was used to evaluate the content of the diagnostic checklist for ESG practices.

Findings As a result, a hypothetical consultancy called ENGES Consulting Ltda. was created, constituted through the creation of the social contract, the creation of the mission, vision, and values, in addition to the development of a business model based on the Business Model Canvas [BMC] strategic management tool. A checklist model was also created for diagnosing ESG practices and their respective maturity level.

Originality/relevance The relevance and contribution of this study in the scientific aspect lie in the proposal of a consultancy model to assess the maturity level of ESG practices in disparate organizations.

Practical implications The practical contribution lies in understanding Environmental, Social, and Governance [ESG] management practices based on the ESG practices diagnosis checklist model and the respective level of maturity, identifying strengths and points that demonstrate implementation or execution weaknesses, in addition to providing a way to compare results (benchmarking) obtained between organizations.

Consultancy; ESG; Maturity models

New Companies	Established Companies
Satisfying a market that already exists but is not being served adequately.	Envision a potential market.
Introduction of a new product or service.	Respond to momentary difficulties.
Improve or transform an already existing market through a better business model.	Entering a new market segment that already exists;
Create an entirely new market.	Introducing a new product, service or technology to the market.

Pillar	Dimension	Description
Offers area - It describes the company’s business, the products and services and the value propositions offered to the market.	Value proposition	- Overview of a company’s set of products and services that have some kind of value for the customer. Questions: What value do we deliver to the customer? What problem are we helping to solve? What needs are we helping to understand? What set of products or services are we offering to each customer segment?
Customer areas - It describes the company’s target audience, how it delivers its products and services, how it keeps in contact and what type of relationship it wants to establish with customers.	Target audience	- Customer segment to which the organization aims to provide value. Questions: Who are we creating value for? Who are our most important customers?
	Relationship channels	- Describes the type of relationship established with your clients. Questions: What kind of relationships does each of our customer segments expect us to establish with them? Which ones have we already established? How much does each one cost? How do they integrate with the rest of our business model?
	Distribution channels	- Means used in maintaining contact with the public. Questions: Through which channels do our customer segments want to be contacted? How can we reach them? How do our channels integrate? Which ones work best? Which ones are the most profitable? How are they integrated into the customers’ routine?
Infrastructure areas - It describes how the company works on issues relating to infrastructure and logistics, which partnerships are necessary and the resources essential to deliver value to the customer.	Value setting	- Demonstrates the organization of activities and resources required to generate value for customers. Questions: What key activities does our value proposition call for?
	Competências	- It is related to the ability to carry out standardized and replicable actions that are useful to create added value to the target audience. Questions: What features does our value proposition require?
	Partnerships	- Cooperation agreements between businesses. This type of agreement seeks superior value creation. Questions: Who are our key partners? Who are our key suppliers? What key resources are we receiving from partners? What key activities do partners perform?
Finance áreas - It describes the revenue model, the cost structure and the sustainability of the business model. It explains how a business makes money through the other three basic elements.	Cost Structure	- Representation in cash of all means used in the business model. Questions: What are the most important costs in our business model? Which key resources are most expensive? Which key activities are most expensive?
	Revenue generation model	- It specifies the way found to earn money through different income streams. Questions: What are our customers really willing to pay for? What do they currently pay? How do they prefer to pay? How much does each revenue stream contribute to total revenue?

Internal Consultancy
Attributes: - Analyze the adequacy, integrity and effectiveness of the company’s internal control system, and the consultant must consider in his work schedule, in-depth knowledge of the work process of others and internal control, in operational activities and reliability in information, thus aiming to identify the existence of possible deviations in relation to the procedures and routines that are managerially established. - Apply technical procedures, with the aim of effectively formulating a quality analysis of the organization’s internal controls and information. - Provide organizations with recommendations, analyzes and suggestions for good performance and effectiveness of their responsibilities and functions, seeking to prevent fraud and frequently committed errors.
Advantages	Disadvantages
Greater knowledge of the informal aspects of the company, as you are an employee of that company;	Lower acceptance at senior levels of the company;
Daily presence;	enerally have less experience;
Greater access to people and groups within the company, as they are an integral part of them;	Less freedom in saying and doing things; and
Effective participation in the assessment and control of the process inherent to the work carried out; and	Normally, they have less impartiality in their actions, as they have greater personal relationships with their co-workers.
It has some formal power, as it is part of the hierarchical structure of the company.
External Consultancy
Attributes: - Ensuring greater neutrality in the analysis of problems, thus, allows managers to be more precise in their decisions. Be an aid to seek better results, since this external vision brings with it various experiences from different clients and contexts. - Develop technical procedures, offering a credible service to the market, consisting of a unique activity, intended for the company and mainly for shareholders. - Check whether the company’s external information regarding competition, future vision, is fully in line with the company’s real situation or whether there are inaccuracies that can be modified.
*Advantages*	Disadvantages
Greater experience, having carried out the same service in several companies;	Less knowledge of informal aspects of the client company;
Greater acceptance at the higher levels of the client company, as, normally, their hiring is carried out by senior management;	It does not have formal power, as it does not belong to the hierarchical structure of the client company.
Can take risks (saying and doing things); and	Have less informal access to people and groups; and
Greater impartiality, as the client company’s day-to-day operations are not involved.	Generally, it is not present daily.

PERGUNTAS	DESCRIÇÃO
(1) Why? (the causes of change)	Why should the company be changed? What should the content of the change include, that is, what should be changed in the organization?
(2) How? (the process of change)	Carrying out the diagnosis is concerned with three aspects: a) the development of diagnostic models; b) the choice of procedures and methods for collecting data in the diagnosis; and c) the choice of methods and techniques for analyzing data.
(3) And what (the content of change)	It is the subject of consultancy project intervention recommendations to support change.

Axis	Description
Environmental	It analyzes the performance and development of practices that aim to preserve the environment and conscious consumption of resources (Manrique & Marti-Ballester, 2017). Practice – Example: The letter E (Environmental), in the acronym, represents the impact that a company causes on the natural environment. This includes issues such as pollution (carbon emissions, toxic chemicals and metals, packaging and other waste), the use of natural resources (water, land, trees) and the consequences for biodiversity (the variety of life on Earth), as well as how it tries to minimize our environmental footprint (energy efficiency, sustainable agriculture, green buildings) (PRI, 2019).
Social	It is linked to gender and the inclusion of people, improving the satisfaction of customers and employees (Velte, 2017). Practice – Example: The letter S (Social) covers issues such as health and safety for employees or working standards and well-being for other workers in the companies’ supply chain. It also involves product safety for consumers or privacy and data security for their users, as well as, companies must be committed to overcoming inequality and discrimination, both through fair treatment of employees and by ensuring that no social group is excluded from access to essential products and services (Ahlklo & Lind, 2018).
Governance	Trata de aspectos de boa gestão interna, conformidade de processos da organização e com a legislação vigente (Tarmuji et al., 2016). Practice – Example.: The letter G (Governance) is linked to the fact that a company manages its business in a responsible manner. This takes into consideration the ethical requirements of being a good corporate citizen, such as anti-corruption policies and tax transparency, as well as traditional corporate governance concerns such as managing conflicts of interest, board diversity and independence, quality of financial disclosures, relationships with stakeholders and evaluation of whether minority shareholders are treated fairly by controlling shareholders (Freeman, 2017).

Components	Description
Levels	Describe the stages of change in a maturity model. Depending on the structure of the model, the levels (usually between 3 and 6) can portray a gradual evolution, or they can symbolize an expression of capacity or another predicate that can be measured by the model.
Model domains	They are a way of accumulating attributes in an area of relevance related to model development. In efficiency maturity models, domains are portrayed as “process areas”, because they are a grouping of processes that make up a larger process or knowledge area. According to the model, users may be able to pay attention to improvements in a single domain or group of domains.
Attributes	Depicts the central theme of the model, grouped by domain and level. They are generally based on observations of practice, standards or other specialized knowledge, and can be evidenced as characteristics, indicators, practices or processes.
Evaluation and scoring methods	Improved methods to simplify analysis using the model as a reference. Scoring methods are community-developed algorithms to test consistency of considerations and a generic standard for measurement. Considerations can be included in the scoring methods so that significant attributes are recognized first over those of lesser value.
Paths to improvement	Even though used for comparative analysis, maturity models can be used to direct improvement efforts. Several of these models have pre-established techniques for carrying out diagnoses of the current reality, planning and implementing improvements and, finally, ensuring their effectiveness.

Macro Dimension	Dimension	Affirmatives
Environmental, Social and Governance [ESG] Practices	Environmental Governance	A1; A2; A3; A4; A5.
	Social Governance	A6; A7; A8; A9; A10.
	Corporate Governance	A11; A12; A13; A14; A15.

Level	Description
Level 5	Established, systemic and optimized: completely implemented, has established indicators, has effective results and has exhibited continuous improvement over the last 12 months.
Level 4	Established and systemic: fully implemented in one or more areas and with established indicators. Planned results are achieved.
Level 3	Formally established: formally implemented (documented), but there are some flaws in execution.
Level 2	Informal or in the implementation phase: implementation was started by the organization. There is an implementation schedule.
Level 1	Lack of practices and standards: not yet implemented or being implemented informally, with unstable results.

Specialist	Area of Activity
Specialist 1	Professor with Post-Doctorate in Administration and PhD in Mechanical Engineering and specific research in social responsibility, sustainability and corporate governance.
Specialist 2	Professor with a Master’s Degree in Transportation Engineering and Territorial Management and specific research integrating the areas of ESG and supply chain.
Specialist 3	Professor with a Master’s Degree in Management and specific research in the areas of sustainability and management.
Specialist 4	Consultant specializing in management, marketing and corporate governance.
Specialist 5	ESG specialist industrial manager and chemical engineer.

Step	Step description
Step 1	Selection of the group of experts
Step 2	Construction of questionnaire 1
Step 3	First contact with specialists and invitation to participate in the research
Step 4	Submission of questionnaire 1
Step 5	Receiving responses to questionnaire 1
Step 6	Qualitative and quantitative analysis of answers
Step 7	Construction and sending of questionnaire 2 with feedback
Step 8	Receipt of answers to questionnaire 2 and its analysis
Step 9	Submission of the following rounds of questionnaires, interspersed with the respective analyzes
Step 10	End of process and writing of final questionnaire

Data	Description
Company Name	ENGES Consulting Ltda.
Address	Uruguay Street, 458 - Downtown, Itajaí - SC, 88302-901
Corporate Purpose	Provide professional services in the areas of assessment, alignment, implementation, measurement and information reporting of Environmental, Social and Governance [ESG] practices.
Administrator	Partner 1 - Brazilian, single, born on the 00th of month of the year, businessman, holder of ID number 00.000.000-00 SSP-SC, registered with CPF number 000.000.000-00, resident and domiciled at Rua Uruguai, 500 - Centro, Itajaí - SC, 88302-903.
Share Capital	The share capital will be R$500,000.00 (Five hundred thousand reais), being divided into 5 shares worth R$100,000.00 (One hundred thousand reais), each, subscribed and paid in, in this act, in the country’s currency, by the partners and distributed as follows: Partner 1 – Four (4) shares worth R$400,000.00 (Four hundred thousand reais), representing 80% (Eighty percent) of the share capital. Partner 2 – One (1) share worth R$100,000.00 (one hundred thousand reais), representing 20% (twenty percent) of the share capital.
Social Financial Year	The fiscal year will close on December 31 of each year.
Owner’s Responsibility	The liability of the company owner is limited to the paid-up capital (Art. 1,052 of the 2002 Civil Code), and he is not subsidiarily liable for the company’s losses.

Mission	Vision	Values
Engage high-performing people who contribute to simplifying complexity, proposing assertive solutions for the benefit of our clients.	We will create and maintain an unblemished reputation, creating the possibility for interest groups to achieve their full potential.	Integrity Teamwork Leadership Respect Transparency

Dimension	Pre-Delphi Method Statements	Checklist 1 Answers		Checklist 2 Answers
Dimension	Pre-Delphi Method Statements	Outcome after Delphi Method	Agreement by statement (%)	Outcome after Delphi Method	Agreement by statement (%)
Environmental Governance	A1	Consensus reached.	100	-	100
	A2	I suggest replacing the word “footprint” with carbon production; I suggest including in Ex.: reduction of fossil fuel consumption.	60	Consensus reached.	100
	A3	I suggest including the reverse logistics mechanism in the issue.	80	- Recommended to remove Law 12,305/2010, due to specialty. - The law was maintained. - Consensus reached.	100
	A4	Consensus reached.	100	-	100
	A5	I suggest including in Ex: exploration of raw materials cannot be predatory.	80	Consensus reached.	100
Social Governance	A6	I suggest rewriting the beginning of that question to: “Regarding the management of people/employees, the company has...”.	80	Consensus reached.	100
	A7	I suggest including the word “equity.”	80	- I suggest including affirmative action that benefits employees. - Suggestion rejected, as the statement concerns organizational policies. - Consensus reached.	100
	A8	I suggest including the words “rights and duties” in relation to current legislation.	60	Consensus reached.	100
	A9	I suggest including an Example: SASSMAQ regulations that act in the management of safety, health, environment and quality in the transport and distribution of chemical products.	80	- I suggest removing the SASSMAQ Standard, due to its specificity. - Maintained the SASSMAQ Norm. - Consensus reached.	100
	A10	Consensus reached.	100	-	100
		Checklist 1 Answers		Checklist 2 Answers
Corporate Governance	A11	I suggest rewriting the sentence “in accordance with certain laws, norms and rules” with the word compliance.	80	Consensus reached.	100
	A12	Consensus reached.	100	-	100
	A13	I suggest using a management methodology based on the “objectives and results” [OKR] method in this issue instead of Key Performance Indicators [KPI].	60	Consensus reached.	100
	A14	I suggest including an Example: “issuing green bonds”.	80	Consensus reached.	100
	A15	I suggest replacing the word “adaptable” with the term “responsive” (reacts or responds in a way that is expected or appropriate in a given situation).	80	- I suggest keeping the word “adaptive”. The term “responsive” is too fancy. - The term “responsive” was kept. - Consensus reached.	100

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Universidade Federal de Santa Maria Centro de Ciências Sociais e Humanas (CCSH), Avenida Roraima nº 1000, Prédio 74C, Sala 4210 - Cidade Universitária, CEP: 97105-900, Tel: +55 (55) 3220-9242 - Santa Maria - RS - Brazil
E-mail: rea@ufsm.br

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