Corporate Sustainability Disclosure Report
The international accounting firm KPMG releases the 2024 corporate sustainability disclosure report, which aims to analyze the development of corporate sustainability disclosure and the differences between disclosure and sustainable strategies.
KPMG believes that with the development of global regulatory policies, companies need to disclose more environmental, social, and governance-related information. Companies are also recognizing that sustainable disclosure will become a tool to improve financial performance. However, most companies still have a gap between sustainable strategy and execution.
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Respondents of Corporate Sustainability Disclosure Survey
This sustainability disclosure report surveyed more than 550 companies, with the United States (61%) and Europe (25%) accounting for the highest proportions. 45% of the companies are listed and 52% are still privately owned. The proportion of companies with 1,000 to 10,000 employees is 59%, and the proportion of companies with annual revenue between US$1 billion and US$10 billion is 60%.
The departments where the employees work are mainly the sustainable development department (25%) and the operations department (14%). The middle management accounts for 34%, and the senior management accounts for 37%. 31% of employees are directly responsible for sustainable information disclosures.
Corporate ESG Investment Status
As ESG information disclosure is gradually included in the regulatory scope, 90% of companies plan to increase ESG investment. 43% plan to increase investment in ESG talents, 40% plan to increase investment in ESG software, and 38% plan to increase investment in ESG training and education.
In terms of the effectiveness of sustainable information disclosure, 30% of companies believe that they are in a leading position, and 53% believe that they are basically in a leading position. Among the tools used for information disclosure, spreadsheets (47%), ERP systems (38%), and specific ESG information systems (37%) account for higher proportion.
Corporate ESG Data Management Status
Many companies are starting from ESG data management to improve the level of sustainable disclosure. 59% of companies plan to use more advanced data systems for information disclosure, and 58% plan to use artificial intelligence and machine learning technology to strengthen data analysis capabilities.
In terms of how to incorporate sustainable goals into corporate development strategies, 45% of companies choose to improve their ESG data management and reporting capabilities. 47% of respondents believe that ESG data analysis and interpretation capabilities will become the most valuable sustainable skills in the future.
In terms of the use of sustainable information disclosure, 43% use it to identify ESG risks and opportunities, 39% use it to develop new sustainable products, and 37% use it to allocate funds for sustainable projects.
Difficulties in Corporate ESG Development
44% of companies believe that lack of resources is a problem facing ESG development, and 41% believe that limited communication between corporate departments may bring pressure to ESG development. In terms of deploying financial resources, 21% of companies have difficulty using Return of Investment (ROI) to measure ESG performance, and 19% face pressure in ESG budgets.
76% of companies plan to adjust in the ESG area to integrate sustainable planning with corporate strategy. 25% have fully integrated sustainable goals into corporate strategies, and 54% have basically integrated sustainable goals into strategies.
40% of companies have outsourced sustainable information collection and management to third parties, and 37% are planning to complete outsourcing within the next three years. Companies outsource the lowest proportion of communicating with investors and formulating sustainable strategies.
ESG Disclosures in Different Sectors
Different industries face different ESG substantive topics, so there are big differences in how to respond to ESG information disclosure. 97% of companies in the consumer industry plan to increase ESG investments in the next three years, and this proportion is 84% in the medical and health industry. 73% of companies in the financial industry plan to use advanced ESG data systems, compared with 43% in the consumer industry. 82% of companies in the energy industry plan to restructure their ESG teams, compared with 65% in the technology industry.
Reference:
Addressing the Strategy Execution Gap in Sustainability Reporting
