Sustainability reporting that earns its keep: from CSRD to strategy

KPMG's 2024 Survey of Sustainability Reporting, which analysed data from 5,800 companies, finds that 96% of the world's 250 largest companies by revenue (the G250) report on sustainability, unchanged since 2022. Among the 100 largest companies by revenue in each country surveyed (the N100), the figure is 79%. Carbon targets are almost as common: 95% of the G250 and 80% of the N100 publish them. The practice is mainstream, which is the first strategic fact for a Chief Sustainability Officer.

If almost every large company reports, then simply reporting says little to an investor, customer or lender. What differentiates is what the report allows others to rely on and what the company has done with the information. KPMG notes that double materiality, the assessment required under the CSRD, is used by half of the largest companies, and that third-party assurance covers 66% of the G250 against 43% of the N100. Differences lie in rigour, not in participation.

For the Chief Sustainability Officer, the implication is that the benchmarking conversation has changed. Board members will no longer ask whether the company reports. They will ask whether its numbers are as reliable as those of peers, and whether the work has changed any decision. If the honest answer is that the report is accurate but not used, the function is exposed when budgets tighten.

The first action is a simple self-assessment against the three measures in the exhibit: whether you report, whether you set targets and whether an independent party assures the data. Add a fourth that no survey captures, which is the number of commercial decisions in the last year that cited sustainability data. If that number is zero, you have identified the real gap.

What to do: set one slide for the board that compares your position with the G250 and N100 benchmarks on the three measures above, and add your own commercial-use measure. A board paper built this way moves the discussion from whether to report to how reliably and how usefully. It also gives the chief financial officer a reason to co-own the data, which is the most reliable way to secure resources for assurance readiness.

A caution about benchmarks is worth adding. Survey populations are skewed towards large and listed companies, and they measure participation rather than quality. A company can sit comfortably above an average and still carry material weaknesses in its data. Use benchmarks to calibrate ambition, not to reassure the board that the work is finished.

The European Commission's Omnibus proposal aimed to remove around 80% of companies from the scope of the CSRD and to deliver around EUR 6.3 billion in annual administrative savings. The agreement endorsed by the European Parliament on 16 December 2025 settles the scope at companies with more than 1,000 employees and net turnover above EUR 450 million, applying to financial years starting on or after 1 January 2027. Many mid-sized European groups that were preparing to report are now outside the mandatory perimeter.

The standards are being simplified in parallel. EFRAG's technical advice indicates that the draft simplified ESRS have a 61% reduction in mandatory datapoints compared with ESRS v1, and its work drew over 1,500 responses. The Commission intends the simplified standards to apply for financial year 2027. The result is a lighter set of requirements for a smaller group of reporters, with detail still to be finalised through a delegated act.

The implication for a company that drops out of scope is not to stop. Its customers, lenders and larger trading partners that remain in scope will still ask for supplier data, because value-chain information underpins their own reporting. A firm that can answer quickly and credibly is easier to buy from. A firm that cannot is a risk to be managed or replaced.

For a company that remains in scope, the lighter datapoint set is an opportunity to simplify. Review the ESRS requirements against what your management actually uses, remove duplicated collection, and invest the savings in assurance readiness. The aim is a reporting process that is smaller and better, not one that is merely cheaper. Smaller scope should be treated as a reason to raise quality.

What to do: ask your largest customers and lenders, in writing, what sustainability data they expect from you in the next two reporting cycles. Their answer defines your real perimeter better than the statute does. Where the same request appears from several counterparties, build it into the core dataset. Where a request is unique, price the effort and decide whether the account justifies it.

Timing remains uncertain in places. The simplified standards still require adoption through a delegated act, and national transposition will follow. Companies should plan for the central case, a smaller perimeter and lighter datapoints from 2027, while keeping the option to accelerate if a customer or investor asks. Flexible planning is cheaper than a rebuilt programme.

Belgium offers a useful view of a European market preparing for the CSRD. In KPMG's 2024 survey, 88% of Belgian N100 companies report on sustainability and 81% report carbon reduction targets. Recognition of climate change risk reached 62%. These are high levels of participation, in line with the European expectation that reporting is normal for large companies.

The depth measures are lower. Only 47% of Belgian N100 companies had adopted the double materiality concept introduced by the CSRD, and 38% obtained third-party assurance. Alignment with TCFD recommendations had grown to 28%, and biodiversity loss was recognised by 26% of companies as a risk to their business. The pattern suggests that many companies report outcomes before they have built the methods that make those outcomes defensible.

For a Chief Sustainability Officer the lesson is that regulatory scope is not the best guide to where effort should go. Even where reporting is already common, the weak points are methods: how topics are identified, how risks are analysed and how numbers are checked. Those weaknesses are what auditors, investors and journalists find first, and they are costly to fix once a number has been published.

The practical step is a short maturity review of your own process. For each reported topic, record who owns the data, how it is verified, which controls exist and how it connects to financial planning. Rank topics by the size of the commercial decision they inform. Fix the high-impact, low-quality items first, and leave low-impact items for later.

What to do: run a two-week diagnostic on three of your highest-value metrics. For each, trace the number from published report back to source system, and record every manual step, assumption and approval. The result is a short list of control weaknesses ranked by risk. It is more useful to an audit committee than a general statement that data quality is improving.

One more point on method: the assurance gap is partly a capacity issue. Providers are stretched, and companies that approach them late will find less choice and higher prices. Early engagement with an assurance provider is often cited as a way to improve readiness, so start dialogue before the reporting year ends and agree the scope of work in advance.

The evidence of commercial reward is strongest where sustainability data is connected to performance. PwC's Global Investor Survey 2025 found that 61% of investors would increase investment in companies using sustainability data to drive efficiency. That is a statement about use, not disclosure, and it matches the argument of this paper. Investors are interested in what the company does with the numbers, because that predicts cost, resilience and returns.

The consumer evidence is more cautious but still relevant. PwC's 2024 Voice of the Consumer Survey, covering more than 20,000 consumers in 31 countries, found that consumers say they will pay an average of 9.7% more for sustainably produced or sourced goods, and 80% say they are willing to pay more. PwC itself warns that actual spending may not match stated willingness, particularly under cost-of-living pressure. Treat the figure as a ceiling for pricing tests, not a forecast.

Behaviour is more modest and more specific. In the same survey 46% of consumers say they are buying more sustainable products, 43% are making more considered purchases to reduce consumption and 32% are eating different foods. The result for product and pricing teams is that demand exists in particular categories and for particular claims, so general statements about being green are less useful than evidence about specific attributes.

The implication is that the Chief Sustainability Officer should offer the commercial team a short list of tested claims, each supported by assured data, rather than a general narrative. Pricing and marketing decisions need to know which attributes, such as lower carbon or recycled content, a given customer segment values and can verify. Where evidence is thin, run a controlled test rather than assuming a premium.

What to do: choose one product line or customer segment and test a single sustainability claim with evidence you can defend. Record sales response, price sensitivity and any challenge from customers. Share the result with the commercial team and the finance director. A modest, well-documented pilot persuades more effectively than a broad strategy paper, and it limits the risk of overclaiming.

Be careful with claims. Stated willingness to pay is not purchase behaviour, and regulators in several markets are scrutinising environmental claims. Any statement used in marketing should be supported by assured data, wording reviewed by legal counsel and a plan for updating it. The reputational cost of a challenged claim usually exceeds the margin gained from it.

PwC's Global Sustainability Reporting Survey 2025 shows that the reporting process itself is being strengthened. Use of AI for sustainability reporting almost tripled to 28% from 11% a year earlier, and very few respondents reported a decrease in investment of resources (5%) or senior leadership time (6%). Companies are putting more effort into the exercise, which makes it more important that the output is used.

Where is the data most useful? Four decisions stand out. Pricing can reflect the cost of carbon, energy and materials rather than historic averages. Product design can use lifecycle data to remove cost and risk. Customer selection can favour accounts where sustainability requirements create advantage. Procurement can prioritise suppliers that provide reliable data. In each case the function already exists; the change is to bring sustainability data into the decision.

The EU Taxonomy illustrates both the opportunity and the gap. In PwC's 2024 study of 530 non-financial companies, the average turnover alignment quota was 9%, compared with an average eligibility of 30%. The distance between eligible and aligned revenue is a measure of unrealised opportunity: activities that could qualify for favourable treatment if technical criteria were met. Finance and strategy teams can use that gap to prioritise investment.

The action for the Chief Sustainability Officer is to attach a named commercial owner to each reported metric. If no one in pricing, product or procurement can say how a metric affects their decisions, ask whether it belongs in the management dataset or only in the report. The exhibit sets out how to map metrics to decisions, which is the central discipline of this approach.

What to do: build a one-page decision log that lists, for each priority metric, the decision, the owner, the date and the effect. Review it each quarter with the executive team. Over time the log shows which metrics earn their place and which do not, and it gives the reporting team evidence for stopping collection of data that nobody uses.

Resource allocation deserves attention. When teams are small, a modest investment in a data owner for each of the top ten metrics tends to return more than a large investment in tooling. Owners resolve definitions, chase evidence and answer questions from auditors and customers. Tools help only after those responsibilities are clear and the data model is stable.

Companies operating across Europe face several frameworks at once. PwC's 2025 survey found that 41% of respondents were planning to report under the CSRD, against 23% under the ISSB framework. The IFRS Foundation reports that thirty-six jurisdictions have adopted or otherwise used the ISSB Standards. In the UK, the government published its UK Sustainability Reporting Standards on 25 February 2026 for voluntary use, with the FCA proposing alignment for listed companies from the beginning of 2027.

The standards differ in emphasis, notably on double materiality, but they draw on overlapping data on emissions, energy, workforce, governance and risk. A company that collects once, with defined owners, definitions and controls, can produce disclosures in more than one format. A company that builds separate processes for each framework will find that costs rise with every new regime and that numbers differ between documents.

For a Chief Sustainability Officer the immediate need is a data architecture decision, not a framework decision. Define a single dictionary of metrics, assign owners, document calculation methods and record evidence. Then map each framework to that dictionary. This reduces rework when rules change, as they have in the Omnibus, and when new jurisdictions adopt standards.

Automation has a role but not as a first step. Many reporting teams find that spreadsheets sit at the centre of their process, and AI tools applied to unclear definitions simply produce faster inconsistency. Settle definitions and ownership first, then automate collection and reconciliation. Tool selection should follow the process design and the size of the reporting perimeter, not the other way round.

What to do: appoint a single design authority for sustainability data, with representatives from finance, operations, procurement and sustainability. Its tasks are to approve new metrics, retire old ones, settle definitions and decide how each framework is mapped. Without such a body, frameworks multiply their own data requests, and each function protects its own spreadsheet at the expense of the common record.

Cross-border groups face a further complexity: subsidiaries may be inside or outside the scope of different regimes. Map each legal entity to the regime that applies, and record where group-level reporting can substitute for entity-level reporting. Doing so avoids both duplicated effort and gaps, and it provides a clear answer when a lender asks which entity reports under which rule.

A sensible plan has four phases. In the first quarter, confirm scope under the revised rules and map your value-chain exposure. In the second, complete the metric dictionary and the maturity review, focusing on assurance readiness and materiality. In the third, connect the highest-value metrics to pricing, product and procurement decisions. In the fourth, test two or three commercial claims with customers and review whether the data held up.

Governance should mirror finance. The reporting lead needs a data owner for each metric, a control owner for each calculation and an executive sponsor who uses the output. The audit committee should receive a short quarterly view of data quality, open issues and the decisions informed. This moves the topic from annual compliance to continuous management, which is how financial reporting already works.

Measure success by use rather than output. Count the commercial decisions that cite sustainability data, the share of metrics with an assured source, the time taken to answer a customer data request and the cost of producing the report. These measures are practical, they can be tracked from existing systems and they show whether the programme is changing how the company operates.

Finally, decide what to stop. The Omnibus and the simplified ESRS give permission to remove data that has no external or internal use. Every metric retired frees time for quality on the metrics that matter. Companies that use this window to simplify will report more credibly and spend less, while those that wait for further clarity will carry duplicated effort into the next cycle.

What to do: schedule a formal review six months after the first full cycle under the revised rules. Compare cost, time to produce, assurance findings and number of decisions informed with your baseline. Share the result with the board and with any customer that has asked for your data. Transparency about progress builds more credibility than a claim of completeness, and it makes the next budget conversation easier.

Finally, protect the people. Reporting teams have carried heavy workloads through successive rule changes. Use the simplification window to reduce manual work, set realistic calendars and recognise the contribution of data owners outside the sustainability function. A programme that depends on exhausted specialists is fragile, whatever the sophistication of the framework or the tools around it.

Finally, review the programme with someone outside the reporting team, such as an internal auditor or a commercial director. An independent reader will notice assumptions that have become habit and will ask which numbers drive decisions. That challenge keeps the work grounded in use rather than in the calendar of reporting deadlines.

Karter McKinley works with leadership teams on strategy and transformation, including how reporting data is governed and linked to pricing, product and investment decisions. We help define the metric dictionary, assign decision owners and design the pilot tests, working alongside your assurance providers and legal advisers, who remain responsible for compliance opinions.