Accenture surveyed over 640 corporate finance leaders across 12 industries and six countries to find their approach to environmental, social and governance (ESG) measurement and reporting.
The ESG measurement benchmark provided by the International Financial Reporting Standards Foundation (IFRS) at COP26 is offering companies new ways to measure ESG performance. Businesses that convert ESG metrics to key performance indicators to measure and enhance sustainability goals are likely to see favourable returns.
Companies that have regularly high ESG performance reported 2.6 times more on total return to shareholders (TRS) than medium ESG performers between 2013 and 2020. However, only 26% of brands have clear and accurate data to track sustainability targets. 70% of companies still measure ESG data using manual or semi-automated processes.
Further, though sustainability data can affect ROI, only 31% of companies have embedded ESG data and measurement into core operations and management information systems. Additionally, 54% of leaders attribute the lack of skills in evaluating and reporting ESG performance as a challenge. Jason Dess, Accenture, states that CFOs, “Have a real opportunity to close the ESG data gap by working with a wider set of ecosystem partners and across their companies.”
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[4 minute read]