A new study by EY has found that some 55% of finance leaders are concerned about potential greenwashing accusations as part of their corporate sustainability efforts.
The findings, from EY‘s 2024 Global Corporate Reporting Survey, also found that some 96% of finance leaders ‘worry about the reliability of non-financial data’, particularly in the context of sustainability goals.
Many report encountering problems with data formats (39%) and inconsistencies (35%), the study found.
Sustainability objectives
Half of all respondents expressed serious worry that their organisations would miss critical sustainability objectives in the coming years. Among finance leaders, 47% believe that most companies are on track to meet their stated goals, while slightly more investors – 53% – share this optimism.
At the same time, investors are hopeful that new reporting standards will help them improve their sustainability disclosures, with close to four fifths (78%) of respondents saying they think new regulations could have a positive impact.
“These are tumultuous times for all business leaders and finance chiefs are no exception,” commented Myles Corson, EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services. “The task of guiding an organisation through short-term volatility while keeping a firm hand on long-term growth relies in no small part on the finance function’s effective use of data to paint a clear picture of future plans and prospects.
“But it’s clear there are major worries among CFOs and the investor community around data transparency and non-financial information, which they cannot afford to ignore.”
The role of AI
Elsewhere, when it comes to technology, including the use of AI in corporate reporting, 55% of finance leaders are apprehensive about compliance costs and regulatory challenges in adopting this new technology as part of their sustainable business strategy.
“Although AI is still in the early stages of adoption, and while it’s clear that many finance leaders are nervous about potential costs, compliance and wider possible risks, there’s no doubting its immense potential to transform data analytics and corporate reporting for the benefit of all,” added Nicolas Lecoq, EY Global Financial Accounting Advisory Services Leader. Read more here.
