Dive Brief:
- A flurry of climate disclosure regulations has prompted many public companies to integrate ESG into their corporate planning, risk management and governance strategies and invest in sustainability reporting technology, according to a report Deloitte released Thursday.
- The report — which surveyed 300 senior business leaders at companies generating at least $500 million in revenue — found that nearly all respondents were making ESG reporting a priority, with 98% meeting quarterly to discuss sustainability goals and 43% meeting at least once per month. Half of the respondents also said they were tapping into new resources to enhance reporting and measurement of greenhouse gas emissions.
- The findings indicated an increase in the appointment of chief sustainability officers and general counsel teams responsible for sustainability reporting within companies, up 13% and 41% respectively from 2022, pointing to a trend of company representatives “taking on elevated responsibilities” for disclosure requirements.
Dive Insight:
The accounting firm, which conducted the survey in January, found 49% of respondents were conducting sustainability oversight by including ESG in the companies’ disclosure committee review while 48% were adjusting and accelerating reporting timelines.
Respondents almost unanimously — 98% — said they had seen their company make progress toward sustainability goals set last year. Of these, 25% reported “significant progress,” 60% reported “moderate progress,” while 14% reported “minimal progress.” Nearly all respondents indicated they were preparing for increased disclosure requirements.
The Securities and Exchange Commission passed its highly anticipated climate risk disclosure rule with a 3-2 vote in March, but decided to stay the rule in April as it works through legal challenges. Though the rule’s implementation is currently halted, it is just one of a myriad of climate regulations American corporations must potentially comply with moving forward. This includes disclosure requirements put forward by California’s two climate bills — Senate Bills 253 and 261 — and frameworks like the European Union’s Corporate Sustainability Reporting Directive.
While survey respondents exhibited an overall growth in sustainable strategies to support their emissions reporting capabilities, the findings also pointed to a decline in executives’ commitment to invest in new technology or tools to allow for more “timely and higher-quality” disclosures. In 2024, only 74% of respondents said they would make such tech investments, down from 99% in 2022.
However, Deloitte said this decline might be due to some companies having already made such investments toward reporting mechanisms and technology over the past few years.
Business leaders surveyed represented industries such as financial services; consumer products; oil and gas; life sciences and health care; technology, media and telecommunications.
