Webinar Replay: How AI is Transforming ESG Ratings Amid Regulatory Challenges
October 22, 2024
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5 mins read
In our latest webinar, "How AI is Transforming ESG Ratings Amid Regulatory Challenges," SESAMm’s CEO and Co-founder Sylvain Forté and Julia Haake, Head of ESG Rating Agency at EthiFinance explored how artificial intelligence is reshaping the way ESG ratings are developed in the face of increasing regulatory pressures. The session focused on AI's transformative role in improving the accuracy, transparency, and efficiency of ESG ratings while navigating the complex regulatory environment in the EU and UK.
Key Takeaways
Upcoming ESG Regulations: New EU and UK rules emphasize transparency in ESG rating methodologies and conflict of interest management, impacting how rating providers operate.
AI’s Role in ESG Ratings: AI is transforming ESG ratings by analyzing vast amounts of unstructured data, improving coverage, and enhancing accuracy for small and mid-sized companies.
Addressing ESG Data Gaps: AI enables more comprehensive data collection and helps fill gaps, especially in regions and industries with limited reporting.
CSRD and ISSB Frameworks: These new standards are driving data standardization in Europe, with AI helping organizations adapt to evolving regulatory requirements.
At SESAMm, we’re committed to helping our clients navigate the complexities of ESG risk management and compliance. Our Partner Network, set to launch in 2025, is a new initiative designed to provide clients with seamless access to expert remediation services—something that is especially important in light of new regulations like CSDDD. Whether conducting on-site audits, providing grievance mechanisms, or offering cybersecurity due diligence, our partners are carefully selected to address diverse client needs.
Why the Partner Network?
Identifying risks is only part of the battle—effectively mitigating them is just as crucial. The SESAMm Partner Network bridges this gap by connecting clients with top-tier partners offering important mitigation services.
Key Features of the Partner Network
Remediation Options: Comprehensive services for CS3D compliance and financial regulations.
Streamlined Processes: Pre-negotiated agreements ensure fast access to expert teams.
Seamless Integration: Automated recommendations and real-time results tracking via SESAMm’s platform.
The Partner Network
Discover our partners below - and keep an eye out for new additions; the Partner Network is growing fast.
Proactive M&A Cyber Due Diligence with CybelAngel
CybelAngel offers a cutting-edge external risk protection platform that proactively identifies and mitigates external threats before they can be exploited. Recognized for its excellence by Gartner, CybelAngel has become a trusted partner for organizations globally.
CybelAngel's M&A Cyber Due Diligence reports provide a comprehensive external assessment of a third party's cybersecurity posture. By combining advanced threat intelligence with expert human analysis, these reports offer crucial context and actionable insights into potential cyber exposures. This approach enables organizations to make informed decisions about mergers, acquisitions, or partnerships by revealing vulnerabilities that may not be apparent through traditional due diligence methods.
The reports include:
Exposure scores and detailed metrics
Benchmark of cyber exposure to industry standards
Detailed analysis, technical findings, and data samples
ESG & Sustainability Assessments, Due Diligence, and more with Indefi
Indefi are strategy consultants dedicated to serving investment managers and financial investors globally. They partner with business leaders on growth strategy, market entry, product development and enhancement, sustainability, M&A and transaction support.
Through this collaboration, SESAMm clients can now access Indefi’s industry-leading services, including ESG and sustainability assessments, buy- and sell-side commercial due diligence, sustainable investment strategies, and sustainability reporting (SFDR, Article 29, and CSRD). This partnership ensures an efficient and effective response to identified risks while supporting clients in meeting regulatory and sustainability goals.
The SESAMm Partner Network will officially launch in Q1 2025. Stay tuned for updates as we welcome new partners to the network and continue to develop innovative solutions for risk and ESG management.
SESAMm’s AI Technology Reveals ESG Insights
Discover unparalleled insights into ESG controversies, risks, and opportunities across industries. Learn more about how SESAMm can help you analyze millions of private and public companies using AI-powered text analysis tools.
Alternative Data | Text Analysis | Sentiment Analysis
In October 2022, this multinational integrated energy and petroleum company found itself in the crosshairs of two non-government organizations (NGOs), accusing it of "exploiting a gas field used to manufacture kerosene used by Russian planes in their bombings in Ukraine," according to the French daily Le Monde. The accusations expressly point out the 16 March 2022 strike, which killed around 600 civilians taking shelter at a Mariupol theatre.
The company? TotalEnergies.
The NGOs? Razom We Stand (Ukraine) and Darwin Climax Coalitions (France).
Also, in October, TotalEnergies posted a third-quarter net profit amid these allegations. "The French group reported an adjusted net income of $9.86 billion, compared with $4.77 billion for the same period in 2021 and $9.8 billion in the second quarter of this year," per Reuters.
Should investors and asset and portfolio managers be concerned? Is this one instance of allegations a nothing burger, or is it a sign—one of many red flags—to evaluate? Let's find out in this edition of Alternative Data Trends: TotalEnergies.
After the spike in controversies in March 2022, TotalEnergies's web mentions continued to increase. And as a reflection of the mentions volume increases, the company's polarity decreases, moving in the direction of negative sentiment. News events triggering these movements include the legal case for allegedly fuelling Russian bombers and refinery strikes over wages.
Let's take a closer look at TotalEnergies's environmental risks, specifically for general environmental strategy, climate change and atmospheric pollution, and biodiversity. The topic of climate change and atmospheric pollution takes the largest share of mentions. Web data driving this volume include:
TotalEnergies's social risks reveal even more controversies, looking at human rights, human capital, and customer relations topics. Human rights and human capital topics almost equally dominate topic mentions. Controversies highlighting the human rights topic include:
Finally, let's look at TotalEnergies's governance risk, specifically within topics for influence strategy and communication, corruption, and board of directors (executive and company management). The influence strategy and communication topic dominates the mentions volume. These controversies relate to greenwashing, such as:
Recapping TotalEnergies's ESG risks and public perception
We only scratched the web data surface for information on TotalEnergies, but even with this overview, you can probably see a pattern. Should investors, asset managers, and portfolio managers be concerned about the latest allegations against TotalEnergies? Maybe. At the very least, the data shows you should dig into the research and ask more questions to mitigate any risks in your portfolio companies.
Reach out to SESAMm
SESAMm is a leading NLP technology company serving global investment firms, corporations, and investors, such as private equity firms, hedge funds, and other asset management firms, by providing datasets or NLP capabilities to generate their own alternative data for use cases, such as ESG and SDG, sentiment, private equity due diligence, corporation studies, and more.
For questions, access to the full report, or to request a TextReveal® demo, contact us here:
Northvolt was Europe's flagship battery champion, backed by Volkswagen, Goldman Sachs, BMW, and BlackRock, and capitalized with over $13 billion in debt and equity. Yet between 2022 and 2025, it became the largest industrial bankruptcy in modern Swedish history, shocking the industry and investors alike. We took a look back at SESAM’s controversy data to see if there were any early warning signals.
The Warning Signs
In September 2022, the first public reports of production delays emerged at Northvolt's Skellefteå gigafactory. By the end of 2023, less than 1% of the planned 16 GWh capacity for 2024 had been delivered. Then came the fatal workplace accidents linked to electrical experiments, and in June 2024, BMW canceled a €2 billion contract. By September, 1,600 employees had been laid off, the cathode expansion was abandoned, and the CFO was replaced.
The Fallout
The consequences were swift. A Chapter 11 filing in the U.S. in November 2024. The resignation of founder and CEO Peter Carlsson. Over 5,000 jobs lost. Major write-downs across the cap table, from sovereign-backed pension funds to global automakers. In March 2025, Northvolt filed for bankruptcy in Sweden, the largest industrial failure in the country's modern history. The reputational damage extended well beyond the company itself, reaching investors, suppliers, and the broader European battery ambition.
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