This article uses the study of two environmental, social, and governance (ESG) data vendors—KLD and Innovest—to exemplify the “social origins of ESG issues” argument made by Eccles and Stroehle in their 2018 working paper “Exploring Social Origins in the Construction of ESG Measures.” Based on in-depth interviews with the organizations’ founders and historical document analysis, we recap the history of the cases and show how different origins, philosophies, and “purposes” of ESG issues shaped the methods and data characteristics of two of the most important data vendors of their time. We discuss why MSCI chose to continue with the financial value–oriented methodology of Innovest while discontinuing the values-driven KLD methodology. Through an in-depth literature analysis, we further show that not only the creation but also the use of “nonfinancial performance” concepts rely on processes of social construction. We also show that investors use different ESG data from those used by academics, potentially leading to misaligned narratives. Finally, with this article we join the call for more explicit contextualization of ESG data, highlighting that both practitioners and academics need to better understand the social construction that underlies analyses that use different concepts of ESG.

As both demand and supply for information about companies' sustainability performance continues to grow, many investors complain that the ESG data universe is getting too complex, lacking clarity about measurement and comparability. Corroborating this concern, several studies have shown how ESG data vendors display very little agreement on how to construct ESG measures. However, as our paper shows, methodological reasons are only one reason for ESG divergence. Instead of comparing the "how" of differences in ESG measurement, this paper focusses on the "why" of this divergence. Leveraging insights from a sociology of quantification and knowledge construction, as well asFoucault's reading on authority, we thus set out to explore the differences between ESG measures as a result of a data vendor's Social Origins: the function of historical origins and the processes of construction which occur within them over time. Three dimensions are examined: data vendors' conceptualization of sustainability, their definition of materiality and their specialization. Examining these Social Origins of nine ESG data vendors, we reveal patterns which suggest that data vendors either pursue a financial value-driven or a normative, values-driven strategy in their creation of ESG data. We further discuss how this difference relates to diverse processes of quantification and the authority which measures are given. Research Strategy and Structure of InquiryBy looking to meet the demand for ESG data, its vendors supply a variety of products which seek to address the information asymmetry about non-financial concerns that exists between companies and their investors (Doh et al, 2010). These concerns include a wide range of issues from, for example, a company's contribution to climate change (the E), its efforts to uphold international labor standards (the S), to the gender composition of its Board (the G).To standardize what constitutes the E, S and G in ESG, and therefore which non-financial matters companies should report on, organizations such as Global Reporting Initiative (GRI), the CDP (former Carbon Disclosure Project) and the Sustainability Accounting Standards Board (SASB) have been created. For example, according to GRI, 82% of the world's largest 250 companies, and in total over 5000 firms, use GRI standards to report on their sustainability performance (GRI, 2019). SASB, on the other hand, is a framework more frequently used by investors. Yet, despite this growing agreement on certain frameworks, a standard definition of

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The effectiveness of private governance on global labour standards remains extremely difficult to assess, let alone measure. Debates surrounding relevant factors focus on two areas: contextual variables regarding social and economic upgrading, and firm-specific characteristics. This article contributes to both debates, looking at characteristics of buyer companies, while also taking institutional variables into account. It examines structural and environmental features of cases encoded in a data set derived from over 1000 audit reports compiled by the Fair Labor Association. Focusing on the apparel, sports- and footwear industry, the article highlights the importance of regulatory quality, economic performance and social freedom in sourcing countries for the success of private governance. The analysis statistically underlines the importance of public governance specifically for process rights, such as anti-discrimination and freedom of association. Complementarity between private and public governance programmes may therefore be particularly important for these standards.