Institutional investors overwhelmingly are displeased with the sustainability information companies across the globe are giving them, according to a new report, with one notable exception.
A majority of investors participating in a PwC survey said they are dissatisfied with the level of corporate disclosure related to climate change, resource scarcity, social corporate responsibility, and good citizenship in the Middle East and North Africa (87%), Asia/Pacific (74%), North America (excluding the United States) (63%), and the United States (61%).
Europe was the only region represented in the survey whose corporate sustainability disclosures pleased most investors, as just 38% were dissatisfied.
Overall, more than two-thirds of investors in the survey are dissatisfied with:
- How risks and opportunities related to sustainability are identified and quantified in financial terms (82%).
- Comparability of sustainability reporting between companies in the same industry (79%).
- Relevance and implications of sustainability risks (74%).
- How the company identifies social and environmental impacts in its supply chain (69%).
- Sustainability strategy that is linked to business strategy (68%).
Desire for this information appears likely to increase over time. While 82% of investors said they considered climate change or resource scarcity in their investment decisions in the past 12 months, 87% expect to consider it in the next three years.
Similarly, 79% of investors considered social responsibility or good corporate citizenship in investment decisions in the past 12 months, but 84% say they will consider it in the next three years.
—Ken Tysiac (ktysiac@aicpa.org) is a CGMA Magazine senior editor.