PwC Global Sustainability Reporting Survey

While some companies are postponing mandatory sustainability reporting for two years in line with the EU Omnibus Package, 40% of respondents to PwC's Global Sustainability Reporting Survey will report according to the original schedule, even if not required to do so by law, according to a PwC statement.

This is because 38% of companies use the sustainability data they collect directly to shape their business strategy, and stakeholders (investors, customers, authorities) also expect reliable information on how risks and opportunities are managed.

Reporting has become part of business
Sustainability reporting will become mandatory in 2025 under the EU's Corporate Sustainability Reporting Directive (CSRD), but the EU has since reduced the number of entities covered by the CSRD and simplified the requirements. Although regulatory changes have slowed the momentum of mandatory reporting, the trend remains unchanged: reporting is becoming increasingly important. Many companies have increased the time and resources they devote to reporting and have developed their technological toolkits to make reporting an efficient, repeatable, and auditable process.

According to the CSRD or ISSB (International Sustainability Standards Board), more than two-thirds of large companies have reported that, in addition to compliance, they have gained significant or moderate value from the data collected and from deeper insight into their organizational operations, and that they are widely incorporating this into their business decisions. Among those who see significant value:

• 38% use the information to shape business strategy (compared to 11% of those who do not see significant value),
• 48% use it to support compliance with other regulations (vs. 15%),
  • 38% use it for risk management (vs. 13%),
• 28% use it to transform the supply chain (vs. 7%),
• 22% use it for corporate finance and investments (vs. 5%), and
• 20% use it to transform the workforce (vs. 5%).
  Where data has become part of strategic decision-making, reporting creates tangible business value.

Value creation is coupled with resource investment
56% of companies generating significant value have significantly increased the resources devoted to reporting over the past year, compared to 26% of all respondents. The role of technology has grown stronger in companies that already report: more than half of them store data centrally and use software that supports carbon dioxide calculation and sustainability reporting.

"The research clearly shows that sustainability reporting is not just a regulatory obligation, but a tool that can create significant business value. It is crucial for companies to continuously improve their reporting processes and integrate sustainability data into business decision-making," Anita Sávoly-Hatta, PwC Hungary's partner responsible for ESG reporting, pointed out.

Investors also care
Pressure from stakeholders has increased significantly: more than half of respondents perceive a growing internal and external demand for sustainability data, and less than 10% see a decline. According to PwC's 2024 Global Investor Survey, more than 70% of investors believe that sustainability should be directly integrated into business strategy, and 75% would increase their investments in companies that take concrete steps to protect the climate.

Technology is also needed for quality data
Many companies are purchasing or developing technological tools and infrastructure for effective, repeatable reporting. The use of AI in sustainability reporting has nearly tripled compared to the previous year. Artificial intelligence is typically used to write and summarize disclosures, identify risks and opportunities, and collect, aggregate, and integrate data, sometimes from multiple different systems. Investors also place an emphasis on quality data: nearly two-thirds (62%) say AI has improved their analytical capabilities.

Practice makes perfect
In practice, more than one-third of companies have already published a sustainability report—most of them in accordance with the CSRD—and in hindsight, they believe that better use of technology, earlier confirmation of data availability and completeness, the involvement of more employees, and cross-functional collaboration would have further improved the process.

Anita Sávoly-Hatta emphasized that "it took decades for regulators, investors, and companies around the world to harmonize the basics of financial reporting. It is therefore not surprising that priorities, timelines, and disclosure requirements are changing in the early stages of sustainability reporting. It is up to leaders to focus on the bigger picture amid these changes: preserving and creating value in an environment where sustainability increasingly determines corporate performance."