07 Feb Investors voice concern over confidence of sustainability reports

According to a recent study by PwC, over 90% of investors are not confident sustainability reports delivered by corporations are free from factors of greenwashing. The Global Investor Survey explored the thoughts of 300 investors and analysts worldwide.

The report represents an investor landscape with caution and concern associated with greenwashing, which directly influences sustainability goals due to its impact on business confidence and reputation. Most respondents stated that they require clear and consistent details on the issues businesses face, in regards to sustainability and adopting emerging technologies like AI. According to the survey, 76% of investors believe it’s essential to report the necessary costs to meet the sustainability commitments the company has set.

James Chalmers, the Global Assurance Leader at PwC, explains that we have moved on from raising awareness about the importance of climate and technology progress to a period where investors are more focused on questions about how businesses manage these challenges and how they define the risks and opportunities.

The lack of confidence surrounding sustainability reporting has caused an increased demand for clarity and consistency, with the belief that stricter regulations and standards should play an important role. 57% of investors feel that with better reporting standards, they would feel more confident with the information to make critical decisions. 

Regarding ESG measures, 76% of respondents want to see enhanced reporting on the costs businesses experience in meeting their sustainability commitments, whether net-zero or social targets. 

Aside from ESG, another primary concern for investors is integrating technology, with over 60% stating that they want to see businesses implement AI technologies at a quicker rate despite the potential risks of adopting technologies that are still evolving.

The respondents from the report highlighted challenges such as data security, privacy and knowledge as the main concerns associated with AI. A total of 86% considered data security and privacy as a possible risk. 

Chalmers concludes the report by stating that corporate reporting must continue evolving to ensure it delivers accurate, consistent and comparable information that investors and other associated stakeholders can depend on to make informed business decisions.