# Moving Towards Performance-Based ESG Ratings

Center for Sustainable Business

August 11, 2021 ![WSJ Photo](/sites/default/files/styles/246w/public/assets/images/Frame%2033.png?itok=MVFKnV9-) Are ESG ratings an effective way for companies to differentiate themselves? In the Wall Street Journal's article, "[When It Comes to ESG, Companies Often Find It Hard to Stand Out](https://www.wsj.com/articles/esg-companies-try-standing-out-11627592724)," authors comment that often many subcomponents of ESG are summarized in a single metric or are rewarded for having policies or tracking systems in place rather than their actual progress against them.

CSB Director [Tensie Whelan](https://www.stern.nyu.edu/experience-stern/about/departments-centers-initiatives/centers-of-research/center-sustainable-business/about-csb/our-team/about-tensie-whelan) adds that many ESG ratings are "process-based, not performance-based.” However, as the ESG field matures, these metrics will increasingly reflect impact and be even more useful for companies to stand out.

Read the full article [here](https://www.wsj.com/articles/esg-companies-try-standing-out-11627592724).