The Power of ESG Reporting: 3 Reasons Your Company Should Start Today

A company's actions in managing environmental and social factors reveal its true commitment to addressing these risks and opportunities. Yes, action is essential, but communicating these efforts is just as important. Here’s why…

1. Investors and Customers Value It

Sustainability is no longer optional. Investors, regardless of the size of the company, are increasingly assessing Environmental, Social, and Governance (ESG) factors when making decisions. Similarly, customers are factoring ESG into their procurement processes.

For companies in sectors with regulatory scrutiny, such as Financial Services, this becomes particularly relevant. 

A PWC survey found that nearly 60% of Private Equity deals now include ESG considerations in their due diligence process.

By reporting on ESG, businesses can clearly demonstrate how they are managing ESG-related risks and opportunities. This not only helps to secure investments and win contracts but also enhances credibility and trust with stakeholders.

2. Proven ESG Performance Adds Value to Your Business

Companies with solid ESG performance are more attractive to buyers and investors. A report by Deloitte found that 83% of M&A buyers would pay a 3% premium for companies with strong ESG practices. Providing a clear, well-structured ESG report can give your business a competitive edge and enhance its value in the marketplace.

3. Regulations Are Coming – Be Prepared

While some businesses are already subject to mandatory ESG disclosures, more regulations are on the way. Don’t wait until reporting deadlines are announced to start preparing. Getting started now will make will make future compliance much more manageable which means you save time and effort in the long run. 

Using a recognised reporting framework will help you structure your report and ensure alignment with upcoming regulatory requirements, such as the EU’s Corporate Sustainability Reporting Directive (CSRD). This approach also ensures consistency and comparability.

Fundamentally, reporting drives and demonstrates action. 

At its core, ESG reporting isn't just about compliance—it drives action and accountability. Addressing the ESG factors that are most material to your business is essential for future commercial success, and your business’ role in driving positive change.

Need help?

At Thrive, we specialise in helping businesses develop Materiality Assessments and comprehensive ESG reports. Get in touch with us today to start your ESG journey by emailing jane@thethrivebusiness.com.