At the crossroads of data, regulations, and digital solutions

Thomson Reuters Institute

The February, 2024 edition of The Hub is highlighting a survey report from Thomson Reuters Institute covering corporate initiatives to adopt ESG in the normal course of business. The survey covered C-suite and functional leaders in a range of roles from Chief Sustainability Officers to Chief Supply Chain Officers and surveyed 183 C-suite and functional leaders across a range of industries and geographies, focusing on North America and Europe. The survey points out that we are at a crossroads in corporate ESG management, with regulation, data, solutions, and actions maturing rapidly. Thus, new challenges, needs, requirements, and opportunities are also emerging for companies looking to tackle ESG.

Key findings on the 2023 State of Corporate ESG include:

• Companies are struggling to keep abreast of the multitude of ESG guidance and regulations, with the risk and compliance tasks of meeting regulations across geographies particularly stretched.
• Companies are turning to third-party solutions to tackle a wide range of ESG activities, such as understanding emerging regulations, supplier and customer due diligence, or monitoring consumers and competitors.
• Adoption levels are already high amongst large companies with investment accelerating behind tools and solutions.
• While historically there has been high investment behind consultative support, spend is now shifting towards tools and software, particularly as ESG standards become more established and reporting more commonplace.

As a result, ESG leaders are seeking new solutions related to data, regulations, and digital solutions:

• Companies are seeking integrated end-to-end solutions and approaches to streamline and simplify the solutions they have in place and improve their inter-operability and connectiveness with other existing enterprise solutions.
• Companies are turning to AI and machine learning to connect disparate data and yield better ESG analysis and insights, especially for greenhouse gas (GHG) emissions tracking.
• Companies are looking for honesty and transparency around what can and can’t be delivered by solutions providers, which is particularly important given the risks now at stake (e.g., regulatory).
• Companies increasingly want help with engaging third parties, including suppliers to improve compliance, as well as tracking actions and performance over time.

Key findings from our survey of C-suite and functional leaders involved in ESG include:

• 71% agree or strongly agree that the role of ESG in corporate performance will grow in the future.
• 60% agree or strongly agree that their company is willing to invest to use ESG as a competitive advantage.
• 56% agree or strongly agree that there’s a consensus across their company’s leadership on the high value of ESG investment.
• 91% currently use third-party solutions related to ESG management.

2023 has proven yet again that we are navigating complex and challenging times with continued visible impacts the world over. Businesses generally recognize the challenge and are thus orienting towards building more sustainable, resilient business models. Through our research we found that 71% of C-suite and functional leaders agree or strongly agree that the role of ESG in corporate performance will grow in the future.

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(IICA duly acknowledge the ownership/authorship/publication rights of the survey report and republishing the same only for educational purpose.)