Understanding Proof's Benchmarking Approach
At Proof, we understand the critical role that benchmarks play in evaluating sustainability performance. Our benchmarks are carefully curated to provide users with valuable insights and context for their sustainability efforts. Here's a closer look at how we develop and maintain our benchmarks:
General Information
Source of Benchmark Data: Our benchmarks are sourced from the data entered by Proof users who directly submit data into the platform on behalf of their own operating entity (i.e., not in aggregate on behalf of a portfolio). This ensures that the benchmarks are relevant, reliable, and reflective of real-world sustainability practices among private market investors and companies.
Regular Updates: We update our benchmarks quarterly with the most recent user data, which may be submitted on a monthly, quarterly, biannual, or annual basis. This continuous updating process ensures that our benchmarks remain current and accurate.
Benchmark Definitions: We align our benchmarks with metric definitions from the leading sustainability frameworks and standards, including (but not limited to) the Global Reporting Initiative, European Sustainability Reporting Standards, Global Impact Investing Network's IRIS+, and the ESG Data Convergence Initiative.
Data Cleaning
Ensuring Data Integrity: We take several steps to ensure the integrity of our benchmark data. This includes removing all test data and data from users who opt-out, giving users full control over their data.
Outlier Removal: We go beyond in-app validations to remove outliers from the data. This helps to ensure that our benchmarks accurately represent typical sustainability performance.
Unified Units: We standardize units across metrics to ensure consistency in benchmark calculations.
Calculation Methodology
Percentile Calculation: Our benchmarks are developed based on percentiles, including the 10th, 25th, 50th, 75th, and 90th percentiles. This approach allows users to understand where their performance stands relative to their peers.
Metric Categorization: Certain metrics are categorized to ensure that the percentile order aligns with performance expectations (i.e., for metrics where a lower value constitutes a higher percentile).
Minimum Sample Size: Benchmarks are developed based on a minimum sample size of 25 organizations, ensuring robustness and reliability. The average number of organizations contributing to each benchmark is approximately 100.
Future Developments
Precision Benchmarks: This will allow users to filter results by geography, sector, and company size for more precise comparisons.
Third-Party Benchmarks: We are exploring the addition of benchmarks from third-party sources to provide additional comparison points and enhance the validity of performance assessment.
Qualitative Metrics: In addition to quantitative metrics, benchmarks on qualitative metrics can provide insights into additional sustainability best practices, user sentiment, and behaviors.
Dynamic Timeframes: We are exploring options to allow users to view changes to benchmarks over time and potentially compare their performance against historical benchmark data.
Dynamic Unit Conversions: This enhancement will allow users to enter data in their preferred units and view benchmarks accordingly.
Enhanced Timeliness: Offering real-time updates to benchmarks ensures users have the most current insights available, empowering more informed and timely decision-making.
At Proof, we are committed to providing our users with robust and insightful benchmarks to support their sustainability journey. Stay tuned for these upcoming enhancements, as we continue to empower our users with valuable data-driven insights.