KPMG Survey Reveals Companies Still Lagging in ESG Reporting Readiness

The journey towards comprehensive Environmental, Social, and Governance (ESG) reporting and assurance continues to challenge businesses, according to the latest findings from KPMG's second annual ESG Assurance Maturity Index. The survey highlights both advancements and persistent gaps in companies' readiness to meet new regulatory requirements for credible ESG disclosures.

The KPMG ESG Assurance Maturity Index, which assesses the ESG preparedness of 1,000 companies worldwide, indicates that while some progress has been made since last year, many organizations remain in the early stages of readiness. The Index classifies companies into three categories based on their maturity: Leaders (top 25%), Advancers (next 50%), and Beginners (bottom 25%).

The survey's key findings reveal critical insights into the state of ESG reporting:

• Regulatory Pressure: 75% of firms are now required, or will soon be required, to report ESG data.
• Supplier Requirements: Among the Leaders, 42% have implemented robust, product-specific ESG requirements for their suppliers.
• Audit Trails: Only 29% of companies have established clear audit trails to support their non-financial information.
• Digital Tools: 46% of Leaders believe digital tools are essential for achieving ESG assurance readiness.
• Overall Readiness: Just 29% of companies report having the necessary ESG policies, skills, and systems in place for assurance.

A Roadmap for Improvement

KPMG's research aims to provide a clear path forward for companies at various stages of ESG assurance maturity. The Index not only evaluates current standings but also offers a roadmap with guidance on critical focus areas and actionable steps for improvement.

For companies striving to gauge their ESG readiness, KPMG offers an interactive survey allowing businesses to benchmark their progress against peers and access the full report. This tool is designed to help organizations identify gaps and implement necessary changes to enhance their ESG reporting and assurance processes.

As the ESG landscape continues to evolve, the message from KPMG is clear: the time for preparatory measures is now. Companies must prioritize the development of robust frameworks to meet increasing demands for transparency and accountability in their ESG disclosures.

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