- Progress and Challenges: 77% of executives report progress on sustainability, but data quality remains a major hurdle.
- Strategic Integration: 99% of companies are preparing for increased sustainability requirements, with many creating new roles and responsibilities.
- Business Benefits: Over 50% see improved efficiency, reduced risk, and enhanced trust through sustainability reporting.
Progress and Challenges A recent Deloitte survey reveals that over three-quarters of executives report significant progress towards sustainability goals. Yet, data quality challenges persist, with 57% of respondents citing it as their top challenge. “Sustainability reporting and transparency can drive trust with stakeholders,” said Kristen Sullivan, US Sustainability and ESG leader at Deloitte. “Strengthening sustainability governance and capabilities is crucial.”
Strategic Integration The 2024 “Sustainability Action Report” shows companies are increasingly integrating ESG measures into strategic planning and risk management. Virtually all (99%) respondents are preparing for potential increases in sustainability requirements, creating new roles and responsibilities. “Regulatory requirements and evolving risks prompt organizations to fill sustainability experience gaps,” said Evan Harvey, Audit & Assurance managing director at Deloitte.
Business Benefits Investing in sustainability reporting is yielding tangible business benefits. Over 51% of respondents report greater efficiencies, reduced risk, and enhanced trust with stakeholders. Enhanced brand reputation and talent attraction are also significant outcomes. “Organizations can unlock strategic insights to capture market value and stakeholder trust,” added Sullivan.
Capacity Building Companies are building ESG capabilities, with 77% creating new roles and 52% forming cross-functional ESG councils. Those with established ESG groups report more significant progress (38%) compared to those without (10%). The emphasis on talent and change management is evident as sustainability governance becomes a strategic priority.
Data Quality Challenges Data quality remains a significant issue, with 88% of respondents citing it as a top challenge. While 74% are prepared to disclose Scope 1 GHG emissions, progress varies across industries. Only 15% are preparing to disclose Scope 3 GHG emissions, facing challenges with vendor data confidence and consistent industry standards.
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Assurance and Regulatory Compliance Organizations are making strides in obtaining assurance over sustainability data. Currently, 80% are moving from limited to reasonable assurance, although only 13% have completed the necessary evaluations. Private companies lag behind, with 72% not having reviewed next steps for assurance readiness.
For more details on how to navigate the evolving regulatory environment, explore Deloitte’s ESG SelfAssess™ tool here.