**ESG Reporting: Pioneering a New Business Dialogue**

Mehasa Consulting | Article Posted Date: 16 November 2021

The landscape of ESG (Environmental, Social, and Governance) reporting is evolving rapidly. Established standards like the Global Reporting Initiative (GRI) have gained significant traction, while emerging frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD) are broadening the scope of reporting requirements.

As these standards become more comprehensive and uniform, they provide companies with a robust foundation for measuring ESG impacts and outcomes, enabling comparisons with peers. The more companies engage in reporting, the better they become at tracking their ESG performance.

According to “Big Shifts, Small Steps,” a survey of sustainability reporting, 96 percent of the G250—the world’s top 250 companies—report on sustainability, along with 79 percent of the N100—the 100 largest firms in each surveyed country. However, this should not be a mere box-ticking exercise.

Increased transparency fosters greater trust and accountability. Investors, regulators, customers, and employees demand action on reducing carbon emissions, halting biodiversity loss, and addressing social inequality. With the global focus on COP27 in Sharm El Sheikh, Egypt, in November 2022, it is crucial for companies to demonstrate their commitment to combating climate change.

Sustaining momentum in sustainability reporting is essential not only to satisfy stakeholders but also to measure the effectiveness of broader ESG strategies. Almost two-thirds of G250 firms recognize climate change as a business risk, underscoring the need to meet global temperature targets and develop strategies for an uncertain environmental future.

**Shifting the Narrative**

Corporate sustainability reporting offers a unique opportunity to foster a new type of business conversation—one that focuses on non-financial goals such as achieving net zero, promoting a low-waste circular economy, enhancing biodiversity, and respecting human rights. For some, this shift from compliance to proactive change may be challenging and costly.

Integrating traditional business and ESG goals requires sustained investment, with ESG remaining a critical item in the annual financial plan. This long-term commitment is essential, and company leaders must budget for it and become comfortable with the ongoing effort.

**Avoiding Distractions**

Today’s businesses face disrupted supply chains, resource shortages, rising inflation, and the threat of recession. However, these challenges must not distract them from implementing sustainable, transparent, and resilient business models to create a better world for future generations.

Sustainability should not be seen as an optional extra but as a core consideration in corporate strategy, planning, and behavior. At this pivotal moment, creating long-term, sustainable growth and value is more important than ever.