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      The dynamics in the area of ESG are often primarily reduced to increased regulatory requirements. In financing transactions, however, it can be observed that higher valuations are being realised for companies with strong ESG characteristics - while at the same time continuing to take traditional valuation parameters such as sales growth or free cash flow into account.

      ESG factors therefore represent value drivers for a positive correlation between ESG characteristics and capital costs that should not be underestimated.

      Decision-makers are looking for orientation

      At the same time, the ESG ambition level of companies and their competitors is rising rapidly and continuously; their own corporate targets can easily slip below the market level: pioneers are in danger of becoming average.

      In this dynamic environment, decision-makers are looking for guidance and a critical and methodologically robust examination of ESG-related corporate objectives in order to secure access to the capital markets through the right ESG positioning. Both listed companies and IPO candidates are facing this challenge.

      Our range of services

      Our multidisciplinary consulting approach consists of the following phases:

      • Market analysis

        You receive a clear view of the ESG positioning of your competitors (peer group) and the ESG requirements of investor groups for your company. We carry out the peer group analysis taking into account publicly available information such as sustainability reports and ESG ratings as well as our access to specialised databases and capital market participants.

      • ESG maturity level of your company

        In a second step, your ESG-relevant activities are analysed in detail. With the help of an analysis, the relevance of the individual ESG topics is determined on the basis of your business model and the upstream and downstream value chain. On this basis, we analyse the status quo of your current ESG strategy as well as existing initiatives and objectives.

      • Gap analysis

        We consolidate the findings from phases 1 and 2 and identify performance gaps, competitive advantages and focus areas. The gaps can be, for example, issues in the areas of reporting, communication, but also of a strategic nature. We also assess the impact of the identified deficiencies on ESG rating results.

        Based on this assessment, an ambition level is set in order to align the ESG strategy with the requirements of the market.

      • ESG value driver analysis

        In order to achieve the desired target image (definition of ambition level), measures must be developed to positively influence the identified value drivers, which must be weighed up in a cost-benefit ratio. The value drivers for improving ESG performance depend heavily on the business model, degree of maturity and timing of the financing project.

      • Development of the ESG roadmap

        The ESG roadmap consists of an initiative portfolio of measures that can be implemented in the short, medium and long term to achieve your ESG objectives - including cost-benefit considerations based on the value driver analysis.  With our multidisciplinary consulting approach and these five phases of our methodology, we accompany you through to the implementation of a flexible and market-driven ESG financing strategy.

      More KPMG Insights on ESG Financing Services

      Your contact

      Tobias Nohlen

      Partner, Audit - Regulatory Advisory

      KPMG AG Wirtschaftsprüfungsgesellschaft