The majority of finance executives are unprepared to meet upcoming climate reporting demands: Accenture
A recent survey by Accenture reveals that only about one in five finance executives at large companies feel well-prepared to meet upcoming requirements for reporting and obtaining external assurance on climate-related risks and opportunities. Despite anticipating an increase in sustainability reporting requirements over the next few years, many executives view sustainability as a potential opportunity for their companies.
The report, titled “From Compliance to Competitive Advantage,” surveyed 730 CFOs and senior finance executives from companies with over $1 billion in revenues across 11 countries and 15 industries. It included in-depth interviews with finance and sustainability executives.
The survey highlights the rising pressure from sustainability-related regulations worldwide, such as the EU’s CSRD regulation, the U.S. SEC’s climate disclosure rules, and initiatives like the U.S. Inflation Reduction Act and the EU’s RePowerEU plan.
The findings show that 85% of respondents expect an increase in mandatory disclosures within the next three years, and 90% foresee ESG issues becoming a major focus over the next five years. Additionally, over 80% feel pressure from at least three stakeholder groups, including regulators, board members, and shareholders, to take action on sustainability.
However, only 22% of CFOs feel well-prepared to disclose climate-related risks and opportunities, and just 10% feel ready to meet reporting requirements in all sustainability areas. Accenture assessed companies’ preparedness across nine key sustainability capabilities, finding that 12% were weak in ESG measurement and management, 73% had moderate preparedness, and 15% had strong capabilities.
The study found a strong correlation between companies well-prepared in ESG measurement and management and those viewing sustainability as an opportunity. For instance, 68% of companies in the “weak” group reported challenges balancing sustainability with profitable growth, compared to only 20% in the “strong” group.
