This article is part of our Fund Series (Part 2 of 4) exploring how funds can operationalize sustainable finance. In our first piece, we covered the big picture — why ESG reporting matters and where regulation is headed. In this follow-up, we examine one of the most persistent real-world challenges: the data bottleneck at the portfolio company level.

Fund-level ESG reporting depends on one thing above all else: reliable data from portfolio companies. But this is exactly where the process tends to break down. Collecting ESG data across a fund’s portfolio should be straightforward, but many fund teams know the reality: requests go unanswered, data arrives late, formats vary, and the final output feels more like a patchwork than a report. This challenge isn’t just operational — it has regulatory implications. EU frameworks like SFDR, require that fund-level disclosures be timely, structured, and traceable. Without strong portfolio company inputs, compliance can become difficult to achieve.

Here are reasons why portfolio companies are often a bottleneck for ESG reporting and how to fix this.

Portfolio Companies Often Lack ESG Capacity

Many companies in a portfolio, especially smaller ones, simply don’t have sustainability managers or data teams. ESG reporting gets added on top of someone’s existing role, with little training and no clarity on how to respond.

Atlas Metrics helps bridge that gap. The platform clearly shows which data points are needed, what structure is expected (e.g., gender breakdowns, GHG scope categories), and the methodology behind each disclosure request. Portfolio companies can see examples and explanations right where they’re needed, so that no external ESG consultant is required.

Data Is Scattered Across Departments

The data needed for ESG disclosures doesn’t sit in one place. It’s spread across HR, operations, finance, legal, and even external entities. This makes the collection time-consuming and error-prone.

Atlas acts as a centralized repository that aggregates data from different sources and teams. It eliminates the need for long email threads and version-controlled spreadsheets. Each user can input data into one shared platform with full visibility for both the company and the fund.

Manual Processes Create Errors and Delays

Manual data entry, inconsistent tracking, and unclear workflows lead to mistakes. These slow down fund-level reporting and complicate audit trails.

Atlas introduces structure and automation. With deadline tracking, auto-reminders, and clear progress dashboards, fund teams always know which portfolio companies have submitted what. Warnings highlight missing inputs before they become last-minute problems.

Inconsistent Formats and Frameworks Add Confusion

Portfolio companies often work with multiple investors, each requesting slightly different ESG data. This leads to confusion, duplicate work, and inconsistent calculations.

Atlas supports multi-party reporting within one system. Companies can respond to different reporting requirements in a streamlined way, without duplicating effort. Built-in interoperability across reporting standards reduces the burden of juggling multiple frameworks.

No Scalability Without Structure

Many funds still rely on spreadsheets, emails, and manual follow-ups to track ESG submissions across their portfolios. This doesn’t scale, especially with growing regulatory complexity.

With Atlas, fund teams get a full overview of their network. The platform shows which data points have been received from each portfolio company, tracks overall completion rates, and aggregates results in real time. Final disclosures can be shared with one click.

Helping Portfolio Companies See the Value

Beyond compliance, portfolio companies often don’t see the strategic benefit of ESG tracking. But ESG data, when accurate and actionable, can help them unlock value, improve performance, and prepare for investor scrutiny.

Atlas makes this connection clearer. By showing how each data point links to specific ESG metrics and regulatory expectations, it builds transparency and trust. Over time, this leads to better engagement and higher data quality. 

And this benefits both sides of the relationship. High-quality structured data enables fund managers to identify portfolio-wide sustainability trends, support targeted improvements, and ultimately enhance ESG outcomes at the fund level. Good data helps funds help the companies - but the process only works if companies are equipped to share the right information in the first place.

Read more about how ESG reporting can impact financial performance and profitability for how ESG reporting impacts financial performance and profitability.

In Summary

The bottleneck in ESG reporting doesn’t come from a lack of will. It comes from a lack of capacity, structure, and alignment across the reporting chain.

Atlas Metrics is built to solve these problems: streamlining the data collection process, reducing friction, and helping both funds and portfolio companies report better, faster, and with confidence.

Ready to simplify ESG across your portfolio? Let’s talk.

FAQs

Why is portfolio company data so important for fund-level ESG reporting?

Fund-level ESG disclosures rely on timely, accurate, and structured inputs from each portfolio company. Without these, funds struggle to meet regulatory requirements like SFDR and to produce high-quality, actionable reports.

What makes portfolio companies a bottleneck in the reporting process?

Many portfolio companies lack dedicated ESG expertise, tools, or processes. Data is often scattered, reporting formats vary, and requests from multiple investors create confusion and delays.

Can small portfolio companies realistically provide ESG data?

Yes — but they need guidance. Many smaller firms have limited resources and ESG knowledge. Atlas Metrics helps by providing clear instructions, examples, and built-in methodologies to simplify what’s being asked.

What if portfolio companies have to report to multiple investors with different ESG frameworks?

Atlas supports multi-party reporting in one system. It maps data across different standards, helping companies respond once — not multiple times — without duplicating work.

Is Atlas suitable for funds with large or growing portfolios?

Absolutely. Atlas is built to scale. It provides portfolio-wide overviews, progress metrics, and one-click reporting that grows with your ESG and regulatory complexity.