Future Proofing Financial Reporting For Sustainability

This insight explores the current non-financial reporting and sustainability disclosure landscape across ESG verticals. Emerging data requirements, tools and templates being used to streamline reporting are outlined. To get prepared, top tips give a blueprint for how corporates can future proof for incoming reporting requirements.

Key Takeaways

• A tsunami of requirements impacting how business and finance disclose their performance on sustainability across all ESG verticals is inbound.
• The EU Sustainable Finance Action Plan and Taxonomy of sustainable market activities is driving a transition to sustainable capital markets. The SFDR is already driving financial market participants to invest in these. From 2024, the CSRD is mandating corporations to report their progress across ESG to demonstrate progress aligned to best practice benchmarks.
• Sustainability disclosure and reporting for capital markets is changing and increasingly tied to access to cheaper capital.
• Globally, the International Sustainability Standards Board (ISSB) expects to finalise sustainability and climate-related risks disclosure standards required in financial reporting in 2023.
• New templates, tools and digitisation of reporting will drive data quality improvements, enable comparison and help to avoid greenwash.
• The Non-Financial Reporting landscape is changing and proactive corporates are in the process of assessing the scope and applicability of the ESG disclosures requirements so that they can develop the requisite reporting strategy and data gathering processes.

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