The U.S. Securities and Exchange Commission (SEC) has officially approved long-awaited climate-related disclosure rules for U.S. public companies. These rules mandate that companies disclose critical information in their annual reports and registration statements. Specifically, they must address climate risks, outline mitigation plans, assess the financial impact of severe weather events, and, in certain cases, report greenhouse gas emissions stemming from their operations. This marks a significant step toward greater transparency and accountability in corporate climate reporting.

A new investing framework called the “Ecological Benefits Framework” can provide a new sense of transparency and accountability in the investing industry.

A recent KPMG survey found that just 25% of surveyed business leaders express confidence in meeting future ESG reporting requirements, despite an increasing reliance on ESG strategies for added business value. The "KPMG U.S. ESG Survey" involved over 200 business leaders responsible for their companies' ESG strategies, primarily from North American companies with revenue exceeding $1 billion across diverse industries.

With Sustainability and ESG disclosures becoming more and more prevalent across the world, the public sector is now seeing its first climate-related disclosure standard for governments and other private sector entities. The International Public Sector Accounting Standards Board (IPSASB) has taken a proactive step towards developing a climate-related reporting standard specifically tailored for the public sector.

Of the 18,600 companies which provided information to CDP, less than one in 200 companies disclosed information against 21 key indicators that CDP includes in a questionnaire which represents a credible climate transition plan. This means of 18,600 only 81 companies - a mere 0.4% - were able to disclosure against key indicators and prove that their climate transition plans are credible. While the number of organizations reporting to CDP has been rising rapidly, increasing by more than 40% in 2022, this 81 organizations is actually a decrease from the 153 companies that provided a credible climate plan the year before.

Last month it was announced that the EU was set to become a front-runner in global sustainability reporting standards by formally adopting the Corporate Sustainable Reporting Directive (CSRD). On Monday, the EU Council announced that CSRD was officially adopted and approved. This new directive will expand on the already existing Non-Financial Reporting Directive (NFRD). The hope is that CSRD will introduce more detailed reporting requirements on companies’ impact on the environment, human rights and social standards.

The EU has become a front-runner in global sustainability reporting standards by formally adopting the Corporate Sustainable Reporting Directive (CSRD). With CSRD officially adopted, this new directive will expand on the already existing Non-Financial Reporting Directive (NFRD). The goal is that CSRD will introduce more detailed reporting requirements on companies’ impact on the environment, human rights and social standards.