Record Growth in Sustainability Reporting Among U.S. Companies
Record Growth in Sustainability Reporting Among U.S. Companies
Governance & Accountability Institute, Inc. (G&A), a prominent player in corporate sustainability consulting and research, has unveiled its latest findings regarding sustainability reports published by U.S. public companies. This research shines a spotlight on the trends emerging from the 2023 publication year, particularly among firms in the S&P 500 and Russell 1000 indices. The compelling data reveals a noteworthy rise in sustainability reporting as the regulatory landscape in the United States aligns more closely with European mandates for Environmental, Social, and Governance (ESG) disclosures.
Insights from the 2024 Sustainability Reporting Research
G&A's 2024 Sustainability Reporting in Focus marks the 13th edition of their annual exploration into how major U.S. companies manage and disclose sustainability information. The report meticulously analyzes the tools and standards utilized in their reporting processes, incorporating frameworks such as GRI, SASB, and TCFD. This year, for the first time, a specific focus on sector-specific reporting trends across all 11 sectors of the Global Industry Classification Standard (GICS) adds further depth to the analysis.
Key Findings from the Research
The research highlights some pivotal data points that underscore the significant advancements in sustainability reporting this year. Here are the primary takeaways:
- A remarkable 93% of Russell 1000 companies produced a sustainability report in 2023, up from 90% the previous year.
- Mid-cap companies within the Russell 1000 showed the largest growth in reporting, with 87% of these firms publishing reports, an increase from 82% in 2022.
- Among the larger companies in the S&P 500, 98.6% reported on sustainability issues in 2023, a slight rise from 98.2% in the previous year.
- SASB was the most applied sustainability reporting standard, with 81% of Russell 1000 reporters aligning with its guidelines in 2023, reflecting growth from 78% in 2022.
- Reports aligned with GRI remained steady, with a slight uptick from 54% to 55% across the Russell 1000. Notably, the smaller companies in this group improved from 40% to 42% adherence.
- Adherence to TCFD recommendations also increased significantly, reaching 60% of Russell 1000 reporters in 2023, a substantial jump from 50% in 2022 and a mere 4% in 2019.
Quotes from G&A Leadership
Louis Coppola, Executive Vice President and Co-Founder of G&A, emphasized the critical moment for companies as they navigate the transition toward mandatory sustainability reporting. He stated, "The shift to mandatory reporting offers an unprecedented opportunity to enhance investor confidence, stakeholder trust, and operational resilience. This is the moment to 'grab the bull by the horns' and embrace the future with clear-eyed determination. Sustainability is at the heart of what makes a business thrive in today’s economy."
Hank Boerner, Chairman and Chief Strategist at G&A, expressed optimism about the level and depth of sustainability reporting being undertaken by public companies. He noted, "The G&A team is encouraged by the increased volume and more comprehensive nature of sustainability reporting by U.S. companies, especially since it is still voluntary. When ESG disclosures are ultimately mandated, which we expect in the near future, companies that report today will be well ahead in complying with these requirements."
About Governance & Accountability Institute
Founded in 2006, G&A is headquartered in New York City and is dedicated to assisting organizations and investors in developing robust strategies around sustainability and ESG topics. G&A’s full-suite process for sustainability reporting is crafted to help organizations attain industry leadership in sustainability while maximizing returns on their efforts. Over the years, G&A has constructed a rich database of corporate sustainability reporting data, informed by the analysis of thousands of ESG reports, aimed at guiding strategy and improving reporting practices.
Frequently Asked Questions
What is the focus of G&A's 2024 research?
The focus is on trends in sustainability reporting among U.S. public companies, especially those in the S&P 500 and Russell 1000, highlighting the increasing volume of reports as regulations evolve.
What were the key findings concerning Russell 1000 companies?
Key findings indicate that 93% of Russell 1000 companies published sustainability reports in 2023, marking an upward trend in corporate accountability and transparency.
Which reporting standards saw increased usage?
G&A's research noted that SASB became the most widely used standard, while alignment with TCFD recommendations also saw significant growth, reflecting a robust response to stakeholder demands for transparency.
What does the increase in reporting imply for companies?
The increase suggests that companies are proactively preparing for potential future regulations mandating ESG disclosures and demonstrating a commitment to sustainability.
How long has G&A been conducting sustainability research?
G&A has been publishing annual sustainability research since 2011, systematically analyzing trends in corporate sustainability reporting.
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