Businesses Worldwide Grappling with ESG Reporting Complexity, According to New Survey by Workiva
NEW YORK--(BUSINESS WIRE)-- According to the 2023 Global ESG Practitioner Survey, commissioned by Workiva Inc. (NYSE: WK), 71% of ESG practitioners surveyed say three or more internal teams contribute to ESG reporting within their organizations. Further, 74% say their companies have appointed at least one employee to oversee ESG reporting and initiatives, up 6% over the previous year, and the same percentage expect their organizations will be required to comply with two or more global regulations. Together, these results illustrate the increasing significance of ESG in corporate reporting and underscore the complexity of ensuring accurate and assured data in ESG reports.
The 2023 Global ESG Practitioner Survey polled more than 900 professionals with knowledge of ESG reporting at their respective organizations. The survey was developed with Alex Edmans, Professor of Finance at London Business School, and builds upon Workiva’s 2022 Global ESG Practitioner Survey, which explored challenges and opportunities in ESG reporting.
“It’s no secret ESG is receiving heightened attention in boardrooms or that increasingly complex frameworks, standards and regulations are presenting new challenges in ESG reporting,” said Edmans. “What struck me from the survey results is the dichotomy between practitioners of all levels agreeing they find value in ESG reporting while managers in the trenches are saying their companies are not applying the same diligence to ESG reporting as they do to financial reporting.”
Executives and Employees Don’t See Eye to Eye
The survey uncovered a disparity in perceptions across seniority levels. While 62% of c-level executives strongly agree that their companies apply the same level of diligence to ESG reporting as they do to financial reporting, only 32% of managers and senior managers share the same sentiment. Likewise, 87% of executives say their organizations have appointed someone to an ESG-specific role, compared to just 68% of managers who say the same.
This suggests a significant disconnect between senior leadership and staff and could mean businesses are not fully prepared to comply with emerging regulation, supporting the results of an earlier survey commissioned by Workiva and PwC.
Reporting and Technology Fuel Value in ESG
Despite this disconnect, ESG practitioners overwhelmingly agree that there is value to be found in ESG reporting, with 90% of survey respondents stating that in the next two years having a strong ESG reporting program will give their organizations a competitive advantage.
Additionally, results may indicate the longer a company has been reporting on ESG, the more likely they are to have realized a return on their ESG initiatives. Respondents from organizations that have been reporting on ESG for five years or longer are more likely to say ESG has generated cost savings and improved brand awareness and/or reputation for their companies, compared to those that have been reporting on ESG issues for two years or less.
Finally, there is a growing belief among practitioners that technology is a key component of ESG reporting. Nearly all survey respondents (95%) agree having adequate technology is critical to successfully managing the ESG reporting process, a 19% increase over last year’s survey, and 97% agree that access to technology and data will play an essential role in making decisions to advance their ESG strategy.
“The survey reinforces what customers share with us every day at Workiva. Though investors and regulation remain top of mind, practitioners know there is more to ESG reporting than responding to external demand. Done well, ESG reporting unveils opportunity and empowers executives with a vision for the future that sets them apart from their competitors in the eyes of their customers, employees and investors,” said Paul Volpe, Senior Vice President of Growth and Head of ESG Solutions at Workiva. “But the complexity in ESG reporting is very real. Practitioners agree that technology is the linchpin in the ESG reporting process, and it’s up to business leaders to equip their teams with the tools they need to unlock the value in ESG.”
Workiva will host a LinkedIn Live featuring Alex Edmans and exploring key findings from the 2023 Global ESG Practitioner Survey on September 12. Register at sm.workiva.com/linkedin-live.
About the Survey
In collaboration with Workiva, Ascend2 conducted a global, online survey of ESG practitioners in July 2023. Ascend2 polled 926 professionals from teams typically involved in ESG reporting, including executive leadership, finance and accounting, ESG operations, internal audit and risk management, and legal.
Respondents spanned nine major global markets, including the United States, Canada, the United Kingdom, Germany, France, the Netherlands, Australia, Japan, and Singapore. All respondents came from companies with at least $250 million in annual recurring revenue, and nearly half (45%) came from companies with $1 billion or more.
To access a full report of the survey’s findings, visit workiva.com/2023-ESG-Survey.
Workiva Inc. (NYSE:WK) is on a mission to power transparent reporting for a better world. We build and deliver the world’s leading cloud platform for assured integrated reporting to meet stakeholder demands for action, transparency, and disclosure of financial and non-financial data. Workiva offers the only unified SaaS platform that brings customers’ financial reporting, Environmental, Social, and Governance (ESG), and Governance, Risk, and Compliance (GRC) together in a controlled, secure, audit-ready platform. Our platform simplifies the most complex reporting and disclosure challenges by streamlining processes, connecting data and teams, and ensuring consistency. Learn more at workiva.com.
Source: Workiva Inc.