According to a new survey by global professional services firm Deloitte, executives at large U.S. companies are rapidly increasing their sustainability reporting efforts, with nearly all actively investing in ESG data and reporting technology and assigning new ESG-focused roles internally to meet rising stakeholder demand and impending regulatory requirements.
For its new "Sustainability Action Report," Deloitte commissioned an online survey of 300 senior finance, accounting, sustainability, and legal executives, as well as interviews, at publicly traded companies with revenues of more than $500 million, across industries such as consumer products, financial services, life sciences, and health care, oil and gas, and technology, media, and telecommunications.
Compared to a similar survey done by Deloitte earlier this year, the research revealed a significant uptick in the pace of sustainability strategy implementation and ESG reporting initiatives. Remarkably, U.S. Shortly after the release of the initial poll, the Securities and Exchange Commission (SEC) announced its proposals for climate disclosures for publicly traded corporations.
The expanding emphasis on ESG includes investments in competencies and human capital. The survey found that well over half (57%) of companies have already implemented a cross-functional working group tasked with driving strategic attention to ESG, with nearly all others (42%) planning to follow suit, compared to the earlier survey results, which found that only 21% of companies had implemented such a working group.
In order to address ESG data and reporting needs, virtually all respondents (99%) said they were somewhat or very likely to invest in more disclosure-focused technology and tools in the next 12 months, and more than 80% reported that their organizations have new roles or responsibilities to prepare for increased disclosure requirements.
96% of respondents plan to seek external assurance for ESG disclosures during the next reporting cycle, a considerable increase from the nearly 75% who planned to do so in the previous study.
The survey revealed that executives expect increased ESG reporting to provide benefits beyond compliance with regulatory constraints. More than half of respondents anticipate quantifiable benefits, such as higher staff retention (52%) and improved return on investment (52%), in addition to intangible benefits, such as increased stakeholder trust (51%). Other significant advantages include enhanced brand reputation (49%) and risk mitigation (48%)
Jon Raphael, National Managing Partner, Sustainability, Transformation and Assurance at Deloitte & Touche LLP, commented on the poll results as follows:
"Sustainability, when integrated into business strategy, is about unlocking value for a firm and its stakeholders and building a sustainable future in which people and the earth prosper together."