Sustainability, ESG & Climate Reporting
Sustainability, ESG and Climate reporting have become essential components of corporate reporting. Today, annual reports are expected to include sustainability and ESG information, showing how these factors are integrated into core business strategy.
Scroll down for case studies of recent Climate Disclosure Reports and Sustainability Reports
Around 64% of employees, consumers and the media are unfamiliar with the term ESG. Non-investors want stories they can connect with.
Currently, climate reporting is overshadowing broader sustainability topics.
Bringing it all together
The Integrated Reporting format is a smart choice for combining sustainability and ESG narratives. This approach weaves these topics into the report’s overall structure rather than tacking them on at the end. More companies are adopting integrated reporting principles to create a cohesive story.
That said, dedicated Sustainability Reports still have their place—especially for organisations with extensive sustainability data to share. Separate reports help prevent arcane ESG disclosures overshadowing the company’s main narrative.
And the rise of mandated climate reporting has seen most companies publish Climate Disclosure Reports as standalone documents.
Sustainability vs ESG: different lenses, same goal
While “Sustainability” and “Environmental, Social, and Governance (ESG)” are often used interchangeably, they serve different purposes. Sustainability tends to focus on how an organisation impacts people and the environment. The ESG lens wants to flip the script—considering how environmental and social factors could impact the business in the future. ESG data is crucial for investors assessing long-term risks and protecting their investments.
Both perspectives are valid. Our recommendation is to develop clarity around your writing strategy in your planning stages. The challenge is bridging these viewpoints when speaking to multiple audiences.
Engaging a multi-stakeholder audience
Writing should always start with the audience in mind, but today’s report has many. Employees, consumers, and the media are generally unfamiliar with the term ESG (around 64%), while investors rely on ESG metrics to assess risk. Presenting ESG data through engaging stories makes it more relatable for all stakeholders. Non-investor audiences want evidence-based stories they can connect with.
Research from Fordham University indicates that sustainability and corporate social responsibility are inherently easier concepts for consumers to understand and embrace than ESG labels. As a result, many companies are getting the communication part wrong. Read why here.
So, there are lessons here about converting the ESG frame of mind to a narrative form that most stakeholders can relate to more easily.
The ascendency of climate disclosures
Currently, climate-related reporting has taken centre stage, overshadowing broader sustainability topics. Climate disclosure is now a top priority—sometimes even receiving more focus than a company’s core business strategy.
This intense reporting load has become a burden for many businesses. Regulators are responding by exploring ways to ease the reporting pressure, especially for smaller companies, by adjusting timelines and reducing requirements.
Simplifying disclosure frameworks
Disclosure frameworks are evolving, with significant consolidation simplifying the landscape. The International Sustainability Standards Board (ISSB), under the IFRS Foundation, has absorbed frameworks like the Climate Disclosure Standards Board (CDSB) and the Task Force on Climate-related Financial Disclosures (TCFD). This move aligns sustainability reporting with financial reporting standards.
The ISSB is also working with the Global Reporting Initiative (GRI) to enhance interoperability, making it easier for companies to report on impacts, risks, and opportunities. While the UN’s Sustainable Development Goals (SDGs) are still relevant, the stronger mandates of ISSB standards have reduced their prominence in reporting.
Modern slavery reporting
Separate reporting on modern slavery remains critical. Legislation like Australia’s Modern Slavery Act requires large organisations to publish annual statements detailing their efforts to address modern slavery in their operations and supply chains.
Final thoughts
In summary:
Sustainability and ESG reporting are essentially the same thing, but seen from different perspectives
Both are essential, but they serve different audience needs, requiring communication consciousness to effectively deliver both both types of audience
The shift towards climate disclosures reflects the global urgency around climate risks, shaping how companies report
Consolidation of reporting frameworks by the ISSB has simplified some processes, though topics like modern slavery still need focused reporting
Understanding these evolving requirements is key to meeting stakeholder expectations and compliance goals.
Have a closer look at some of our Sustainability and Climate Disclosure Reports.
