September 22, 2021
Published: Financial Executives International (FEI)
Demand for high-quality information related to a company’s reporting on environmental, social, and governance activities (ESG) has dramatically increased. As one finance executive noted, “there are companies or customers that won’t do business with us unless we do a climate survey and score a certain grade, so customers are demanding it. Investors are interested in it. Our peers are doing it. If you don’t report on ESG, you look like you’re not keeping up with others in your industry.”
Given financial reporting professionals’ critical expertise with disclosure and control implementation,it’s no surprise that Financial Executives International (FEI) members are being tasked with implementing ESG disclosures in filings and dedicated sustainability reports.
But in reality — according to our survey and subsequent interviews — management reporting professionals are only at the onset of integrating ESG information into their financial reporting practices because of significant hurdles, including competing and sometimes conflicting disclosure frameworks, reporting methodologies, and stakeholder demands.