Global professional services provider KPMG has released its ESG Assurance Maturity Index, which collected the responses of senior executives and board members at 1,000 organisations across industries and global regions with a mean revenue of US$18.9 billion.
The index is composed of five pillars:
- Governance,
- Skills,
- Data management,
- Digital technology, and
- Value chain.
Measured on a basis of 1-100, the index assesses a company’s maturity and, based on ranking, classified organisations into:
- Leaders in the top 25th percentile (29 per cent),
- Advancers, in the next 50th (46 per cent) and
- Beginners, the bottom 25th (26 per cent).
While it found that the percentage of companies in the Leader category had grown, the research also found that under a third (29 per cent) feel ready to have their ESG data independently assured.
Nine months ago this figure stood at 25 per cent, meaning there has been little change despite fast-approaching regulatory deadlines to report on ESG.
Further, in the Beginner group, the average maturity score fell by 5.3 per cent, from 30.5 to 28.9.
The ESG Assurance Maturity Index also found that the higher a company’s revenue, the more likely it is to be advanced in its ESG assurance preparations.
For example, for companies with revenues of over $100bn, the score peaked at 69.5 (on a 0-100 scale), while for those with revenues under $5bn, it sat at 39.3.
The benefits of becoming ready for ESG assurance also go far beyond mere compliance, the research shared, with key expected benefits including greater market share (56 per cent), decreased costs (48 per cent), and new business models (46 per cent).
Elsewhere, the research spotlighted obtaining and maintaining sufficient internal skills and expertise as the challenge most widely cited by respondents (44 per cent), which was found to apply across Leaders, Advancers and Beginners.
Over half of companies (54 per cent) plan to hire externally as a result – among Leaders, the proportion is higher at 59 per cent.
For the full report, head here.