In the era of increasing legislative demands and intensifying expectations from investors, ESG reporting is becoming a critical element of risk management and trust building among stakeholders. However, according to a KPMG report, only 29% of surveyed global companies are prepared for an external audit of ESG reports, indicating a significant need to intensify efforts in this area. Meanwhile, as many as seven out of ten organizations are still at an early stage of maturity in reporting non-financial information.
The results of the KPMG International survey show that although more and more companies understand the importance of ESG reporting, many of them still face numerous challenges in adapting to new regulations. Currently, 63% of the companies use limited verification of ESG data, a rise of 13 percentage points compared to the previous year. Meanwhile, 71% of organizations believe they are at an early stage of maturity in reporting non-financial information, highlighting the need for further improvement in this area.
Companies must immediately adapt their practices to new regulations. The increasing pressure from investors and society emphasizes the importance of transparency in ESG, which is becoming a critical factor in building trust and reputation. Compliance with requirements not only helps to avoid potential sanctions, but can also bring additional benefits such as improved operational efficiency and strengthened market position. Attention to transparency in non-financial data reporting is a way to gain competitive advantage and meet stakeholder expectations – says Marek Gajdziński, Partner, Head of Audit at KPMG in Poland and Central and Eastern Europe.
Interest in ESG reporting is also on the rise in terms of frequency of data publication. A whopping 85% of companies report their ESG results at least once a year, while almost a quarter of the leading companies do so semi-annually or quarterly. Despite these positive trends, many companies still face challenges such as implementing systems and processes that allow for reliable collection and auditing of data. Currently, only 29% of companies have full audit trails enabling effective monitoring and documentation of ESG processes.
Ensuring high quality and credibility of ESG reports is becoming increasingly important not only for recipients, but also for meeting regulatory requirements. For this reason, investments in robust control systems and efficient internal procedures will allow for effective monitoring and documentation of ESG information in companies. In addition, mandatory attestations of sustainable development reports are essential to confirm the reliability of non-financial data. Cooperation with experienced external auditors and constant improvement of reporting practices will help companies better prepare for inspections and verifications – emphasizes Jarosław Fąfara, Partner Associate, ESG Assurance, Audit Department at KPMG in Poland.
ESG audits are becoming an increasingly important tool for risk reduction and reputation building. More and more companies are investing in verification processes, which brings numerous benefits such as lower costs, improved product and service quality, and increased market share.
Source: https://managerplus.pl/raportowanie-esg-tylko-29-firm-globalnych-gotowych-na-zewnetrzna-weryfikacje-danych-51430
