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illuminem summarizes for you the essential news of the day. Read the full piece on ESG News or enjoy below:
🗞️ Driving the news: In 2023, 79% of FTSE 100 companies sought external assurance for their Environmental, Social, and Governance (ESG) metrics, up from 75% in 2021
• This trend reflects a growing emphasis on transparency and reliability in sustainability reporting, driven by regulatory pressures like the Corporate Sustainability Reporting Directive (CSRD)
🔭 The context: As ESG reporting becomes increasingly critical, 47% of companies are now using the same practitioner for both ESG assurance and financial audits
• The dominance of Big 4 firms in providing ESG assurance has also grown, with these firms handling 63% of assurance services in 2023, showing an 8% increase since 2021
🌍 Why it matters for the planet: Enhanced ESG assurance supports greater transparency and accountability in corporate sustainability practices, essential for addressing global environmental and social challenges
• Reliable ESG data helps stakeholders make informed decisions and pushes companies toward more sustainable practices
⏭️ What's next: With the upcoming implementation of the CSRD, the alignment between financial and ESG reporting is expected to become more critical
• Companies will need to improve coordination to meet stricter assurance and reporting requirements, ensuring their sustainability statements are integrated within their annual reports
💬 One quote: “This means the vast majority of the FTSE 100 have at least some experience of the requirements of an assurance process,” KPMG noted, emphasizing the importance of external assurance in strengthening ESG transparency.
📈 One stat: 94% of ESG assurance reports in 2023 were for limited assurance, indicating less rigorous procedures compared to reasonable assurance, which only one company obtained for all its key performance indicators (KPIs)
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