ESG ratings hold increasing importance for investors, instilling confidence in sustainable investments. Decision-makers must integrate ESG factors into their strategies. This will let them assess risks and the impact of environmental, social, and governance issues. Companies use ESG ratings to evaluate operational risks, investment opportunities, and performance relative to peers. Often, we distinguish between ratings using a double materiality perspective (assessing risks for and impacts on the company). Another approach entails a single materiality perspective (assessing only risks, or only impacts).