Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Only 1 in 4 global firms ready for ESG data assurance: KPMG
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By Anna J. Park
KPMG ESG Assurance Maturity Index 2023 reveals global firms lack readiness
Only 25 percent of global companies surveyed are ready for independent ESG data reporting, a recent KPMG report says.
The Road to Readiness: KPMG ESG Assurance Maturity Index 2023 published by the global accounting and consulting company on Thursday shows that only one in four global companies surveyed feel that they have the ESG policies, skills and systems in place to be ready for independent ESG data assurance.
The report conducted a survey of senior executives and board members at 750 companies across industries and regions around the world, in April and June this year, measuring the progress companies have made in key areas of ESG readiness.
75 percent of the companies that responded said that they feel they have a long way to go to have their ESG data assured and in compliance with related regulatory requirements. Over half of those who feel least ready say it is a challenge to balance ESG assurance goals and the profit expectations of shareholders.
In contrast, the companies who were surveyed that consider themselves most ready for ESG reporting tend to have boards more engaged on ESG issues, while conducting regular ESG training sessions.
Also, in general, larger companies with earnings of over $10 billion tend to be more ready for ESG disclosure obligations, with an average score of 56.3 points on a scale of zero to 100, compared to companies sized between $5 billion to $10 billion, scoring 45.3 and companies less than $5 billion getting a score of 41.7.
Geographically, ESG assurance readiness was stronger in companies based in France (scoring 50.4 points), followed by Japan (50) and the U.S. (49.4), while Brazil (43.1) and China (43) ranked the lowest.
As to challenges in preparing ESG reporting, respondents mention high costs and inefficient budgets (44 percent), lack of internal skills and experience (44 percent), lack of clear regulations (42 percent), lack of ESG preparation by suppliers (42 percent) and lack of IT or digital solutions (39 percent).
Starting next year, the International Sustainability Standards Board (ISSB) will implement the first tranche of mandatory regional and international sustainability financial reporting standards, as stipulated in the new IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures.