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We Are Living in a Material World: The State of U.S. Sustainability Reporting

September 29, 2021
By Martha Carter, Matt Filosa, Jeffrey Sindone, Faten Alqaseer & Morgan McGovern

The significant events of 2020 have caused companies, institutional investors and regulators to re-energize their efforts towards sustainability initiatives. Institutional investors have dramatically enhanced their focus on issues relating to climate, diversity, human capital management and board governance (collectively, “ESG”).

Under the Biden Administration, U.S. regulators are on the verge of mandating greater transparency from all companies on their sustainability initiatives. While many companies have a long history of focusing on sustainability issues, communicating those initiatives to stakeholders is a relatively new endeavor. And stakeholders are evolving their demands for company sustainability disclosure faster than ever before, especially on critical issues like climate change and diversity. There has never been a more important time to ensure that company sustainability disclosure is robust, clear and credible - while also keeping pace with the rapidly evolving demands of stakeholders.

Yet, unlike proxy statements and other company documents, there is no clear disclosure framework for company sustainability reports. And despite ongoing initiatives from the U.S. Securities & Exchange Commission and the International Financial Reporting Standards Foundation, a uniform global sustainability reporting framework seems unlikely to emerge in the near-term. So how are companies evolving their sustainability reporting to meet the increased demands from stakeholders? What should the title be? And how many pages should it include? In short, what does a “good” sustainability report look like?

To help companies answer these and other important questions about future sustainability reports, we analyzed 200 sustainability reports from S&P 500 companies published between January 1, 2021 – June 30, 2021 (“Sustainability Reports”).

In this report, we have included market statistics for many common formatting and content elements of 2021 Sustainability Reports, as well as examples that we believe are particularly well communicated. In addition, we have included the following callouts:

  • Ten Practical Considerations for 2022 Sustainability Reporting;
  • Unique Naming Conventions of 2021 Sustainability Reports;
  • Essential Design Considerations for 2022 Sustainability Reports; and
  • Key Statistics of 2021 Sustainability Reports (Appendix)

We hope that this report is a helpful, practical tool to aid all U.S. companies in their 2022 Sustainability Report strategies. Please click the 'Download here' button below to view the full report.

Download here
The views and opinions in these articles are solely of the authors and do not necessarily reflect those of Teneo. They are offered to stimulate thought and discussion and not as legal, financial, accounting, tax or other professional advice or counsel.

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