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- Sustainability Gains: Over 75% of executives report progress toward sustainability goals.
- Data Quality Issues: 57% cite data quality as the top challenge in ESG reporting.
- Increased ESG Investment: 99% are preparing for increased sustainability requirements.
Despite data quality issues, a significant number of companies are integrating sustainability into their strategies. According to Deloitte’s 2024 “Sustainability Action Report,” over 75% of executives have seen progress in their sustainability goals.
“Sustainability reporting and transparency can drive trust with stakeholders and is now subject to assurance and regulatory scrutiny in many jurisdictions,” says Kristen Sullivan, Audit & Assurance partner, Deloitte & Touche LLP.
The SEC’s climate-related disclosures and the EU’s requirements are pushing organizations to invest in sustainability reporting. Over half of the surveyed executives reported that sustainability efforts led to greater efficiencies, reduced risks, and enhanced stakeholder trust.
“By strengthening sustainability governance and capabilities, organizations can prioritize performance on material sustainability impacts, risks and opportunities, and unlock strategic insights to help capture market value and stakeholder trust,” adds Sullivan.
Data quality remains a significant hurdle, with 57% of respondents identifying it as their top challenge. Despite these issues, 74% are prepared to disclose Scope 1 GHG emissions, up from previous years.
Companies are enhancing their ESG capabilities, with 99% preparing for increased sustainability requirements and 77% creating new roles. The rise of ESG controllers and increased involvement of CSOs and general counsel highlight the strategic importance of ESG.
“Regulatory requirements and the evolving risk landscape have prompted many organizations to fill sustainability experience gaps in the C-suite, boardroom, and beyond,” notes Evan Harvey, Audit & Assurance managing director, Deloitte & Touche LLP.
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Organizations are seeking assurance over their sustainability data, with 80% taking steps towards reasonable assurance. Many are using multiple standards, with ISSB/SASB, GRI, and TCFD leading the way.
“Organizations that have been taking a ‘wait and see approach’ to climate-related risk and reporting may find that they have catching up to do in order to prepare,” observes Sullivan.
The integration of sustainability into business strategies is progressing despite data challenges. The focus on capacity building, regulatory compliance, and strategic investment in ESG capabilities is driving organizations towards more robust and credible sustainability reporting.
For more details, read the full 2024 Sustainability Action Report.