As international investment flows and technical barriers such as CBAM or IFRS disclosure requirements gradually become mandatory standards, “ESG” has become a ubiquitous keyword in Vietnam. However, the combination of real demand and a wave of media attention has led to a harmful misunderstanding: equating recognition lists with Rating Agencies.
It is time to redefine terms and establish a transparent “frame of reference” for the market.1. A dangerous conflation of concepts
In Vietnam, it is easy to come across ESG titles presented at large-scale award ceremonies. For businesses, these are effective PR tools. The danger, however, is that when those very “titles” are presented to foreign investors or global financial institutions, businesses receive scepticism instead of a competitive advantage. This is because recognition and rating are two entirely different categories.
2. Distinguishing Rating Agencies from Award Organisers
To avoid technical and legal risks when entering the global arena, a clear distinction is needed:
ESG Rating Agencies:Basis of assessment: A scientific Methodology and a quantitative, data-driven system.
Technical value: Used directly for capital appraisal and compliance with international standards.
Legal standing: Recognised by financial markets and global institutions.
Award Organisers (Awards/Recognition):Basis of assessment: Qualitative surveys, self-declared submissions or media voting.
Technical value: Serves to encourage the movement and enhance image.
Legal standing: Only of domestic media value, with no technical value abroad.
A genuine rating agency does not “give awards” based on impressions; it “scores” based on raw data transparency.3. The benchmark list: what counts as global recognition?
The market should focus on organisations capable of providing quantitative data with internationally verified methodologies:
– International institutions: Sustainalytics, MSCI, S&P Global. These are the “giants” supplying ESG data to major investment funds.
– Domestic organisations with international standards: VietESG. As GRI's official software partner in Vietnam, VietESG represents a generation of domestic rating organisations that prioritise data infrastructure and international methodologies, giving Vietnamese businesses an ESG “passport” strong enough to go far.
4. Advice: choose “Substance” over “Status”
Businesses need to be clear-headed:
– If the goal is brand communication: recognition lists are an option.
– If the goal is raising capital and complying with international regulations: turn to professional ESG Rating organisations.
Don't let surface-level titles mask a lack of real data. In the era of IFRS and CBAM, “raw data transparency” is the only language of power that international partners understand and respect. Let ESG guide sustainable development, rather than be a trophy sitting on a shelf.
