However, 85% are concerned they do not have the
right technology in place to meet ESG reporting requirements
A new survey released today by PwC US and Workiva Inc. (NYSE:
WK) finds 70% of business leaders report they are not waiting for
the U.S. Securities and Exchange Commission (SEC) to finalize the
climate disclosure rules and will proceed with compliance
regardless of when they become U.S. law.
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Assurance and technology are key to compliance
Readiness varies across companies, and even business leaders
that say they feel prepared also acknowledge there will likely be
significant challenges to complying with the SEC’s proposed climate
disclosure rules including deadlines, resourcing, technology, and
budget.
Independent assurance will be a necessary component to meeting
deadlines with investor-grade, transparent, and trustworthy data.
Seventy percent of executives report their companies already seek
voluntary, independent assurance–and will continue– even if it is
not required for reporting scope 1 and 2 greenhouse gas emissions.
Almost all leaders (96%) say they will proceed with assurance,
regardless of whether it is included in the final SEC rules.
“Decisions in the capital markets are being made related to ESG,
and it is our belief that market participants and other
stakeholders are entitled to the same quality of information as
they expect from financial related disclosures,” said Kevin
O’Connell, Trust Solutions ESG Leader at PwC. “Many ESG issues can
be material to a company’s core strategy and long-term value
creation. Regardless of when the SEC rules are finalized, investors
and stakeholders have made clear: this is important. Companies
should be preparing by transitioning to investor-grade and
tech-enabled reporting to help accelerate their reporting process,
and looking to implement effective governance and internal
controls.”
While 68% of executives report their company already uses
technology for ESG reporting, 85% are concerned their company does
not have the right technology in place to support the level of
reporting required in the proposed rules, despite almost all
anticipating it will play an important role in meeting potential
new requirements.
“Having the right technology, people, and timelines will be
critical to complying with the proposed rule changes and other
stakeholder demands for ESG transparency,” said Julie Iskow,
president and chief operating officer, Workiva. “Our research also
indicates that independent assurance is expected to play a major
role in companies meeting expected requirements. ESG reporting is
complex, requiring the ingestion, capture, management, and
reporting of financial and non-financial data from many disparate
sources. The more that ESG reporting is integrated into the
decision-making processes of companies, boards and investors, the
more important it is that the information is trustworthy.”
Businesses are investing in ESG reporting
Although 95% of business leaders say their company is
prioritizing ESG reporting more now than before the rule was
proposed, four in ten admit their company isn’t fully prepared to
meet the expected disclosure requirements. That lack of preparation
isn’t due to a lack of knowledge—leaders are acutely aware of the
proposal and believe it sets clear expectations around what data
and information needs to be disclosed; however, they expect to need
more time once the rule goes into effect.
Many companies have already prioritized reporting and begun
taking proactive measures. All executives shared that their company
has taken at least one action in anticipation of the rule becoming
law, with many taking more than one. While these actions vary, the
most common include: investments in ESG reporting technology (40%)
and people (33%), and accelerating (35%), or establishing, if
necessary (33%), climate ambitions or goal timelines.
There are a number of steps that leaders should begin
considering to help make sure their companies are prepared when the
proposed rules go into effect. To meet investor demands and get
ahead of the final rules from the SEC, forward-thinking
organizations should begin tackling their ESG data and reporting
strategy now.
Read the full report here: Change in the Climate.
Join Workiva and PwC US for a free webinar on March 14, 2023 at
2 p.m. EST exploring how companies are preparing for the SEC
climate disclosure requirements and planning to address barriers to
compliance. For details, visit workiva.com/sec-webinar.
About the Survey
Workiva and PwC US jointly commissioned a study to evaluate
corporate executives’ level of preparedness regarding the SEC’s
proposed climate disclosure rule. In total, 300 corporate
executives were surveyed between December 2022 and January 2023.
Corporate executives are defined as senior-level decision makers
with knowledge or responsibility for ESG reporting at U.S.-based
public companies with at least $500 million in annual revenue. To
access the report detailing all survey results, visit
workiva.com/sec-survey.
About Workiva
Workiva Inc. (NYSE:WK) is on a mission to power transparent
reporting for a better world. We build and deliver the world’s
leading cloud platform for assured integrated reporting to meet
stakeholder demands for action, transparency, and disclosure of
financial and non-financial data. Workiva offers the only holistic,
unified SaaS platform that brings customers’ financial reporting,
Environmental, Social, and Governance (ESG), and Governance, Risk,
and Compliance (GRC) together in a controlled, secure, audit-ready
platform. Our platform simplifies the most complex reporting and
disclosure challenges by streamlining processes, connecting data
and teams, and ensuring consistency. Learn more at workiva.com.
Follow Workiva on LinkedIn: www.linkedin.com/company/workiva
Like Workiva on Facebook: www.facebook.com/workiva Follow Workiva
on Twitter: www.twitter.com/workiva
About PwC
At PwC, our purpose is to build trust in society and solve
important problems. We’re a network of firms in 155 countries with
over 327,000 people who are committed to delivering quality in
assurance, advisory and tax services. Find out more and tell us
what matters to you by visiting us at www.pwc.com.
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Media Inquiries:
Rotha Brauntz Lauren Covello press@workiva.com
Suman Syed suman.syed@pwc.com
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