85% Of Companies To Continue Climate Disclosures Despite Shifts

Workiva Inc. has conducted a new study that has shown that business leaders are sticking to sustainability reporting and climate disclosures despite political and regulatory risks. The research points out the increasing awareness among investors and executives that sustainability integration not only provides compliance value but also strategic value in risk management, performance improvement, and investor trust.

85% of firms, in accordance with the study, intend to keep going with their climate disclosures independent of policy developments. Such staunch intention reflects the reality that sustainability has become a business strategy as opposed to a compliance measure. Firms are making long-term investments to ensure that it is aligned with environmental and financial targets in order to be resilient in the face of changing political environments.

Workiva CEO Julie Iskow highlighted the need for linking sustainability and financial reporting, indicating that companies are focusing on doing so not only to achieve compliance but to spur overall corporate performance. "Confident financial and sustainability reporting is not a compliance play, it's a risk-mitigation strategy, performance driver, and investor confidence builder," Iskow said.

Increasing Investor Interest in Transparency

Investor attitudes are also taking a key role in driving firms towards sustainability integration. The research discovered that 93% of institutional investors would prefer to invest in companies that integrate financial and non-financial reporting. This call for transparency is transforming business strategies, forcing companies to give correct and detailed sustainability information.

A notable challenge, though, is that of data reliability. Though 92% of investors value accuracy in data, almost a quarter of executives stated that they do not have complete faith in their own financial data. This discrepancy emphasizes the necessity for enhanced reporting systems, enhanced data management systems, and greater alignment between financial and sustainability reporting teams.

Tensie Whelan, Distinguished Professor of Practice for Business and Society and Founding Director of the NYU Stern Center for Sustainable Business, underscored the need for urgent corporate action. "The market has spoken, and forward-looking companies aren't waiting – they're acting and committing to science-based targets and more robust disclosures," she said.

The Business Case for Integrated Reporting

The Workiva report highlights the unequivocal business case for financial and sustainability reporting convergence. An astonishing 97% of executives are convinced that convergence not only assists in the identification of performance gaps but also opens up new opportunities for financial growth. As global regulations continue to tighten, businesses are realizing that forward-thinking sustainability initiatives can create substantial competitive benefits.

One of the most important regulatory drivers in this transition is the European Union's Corporate Sustainability Reporting Directive (CSRD). With the aim to increase transparency and accountability, the CSRD is compelling organizations to integrate sustainability with their fundamental financial strategies. Ida Bohman Steenberg, Tietoevry's Chief Sustainability Officer, characterized the rule as a disruptive force, explaining, "The CSRD is a game changer that enables us to handle and report on our sustainability aspirations to a new degree. The synergy between CFO and CSO teams enhances decision-making and long-term value creation."

Beyond compliance, companies are increasingly viewing sustainability as a profitability driver. Maher Al-Haffar, CFO of CEMEX, highlighted how sustainability initiatives directly impact financial performance. “Sustainability is incredibly important because it contributes to the profitability of the business,” he said. “As a CFO, I’m focused on providing investors with data they can quantify and model.”

A Long-Term Commitment

Despite ongoing political debates and shifting regulatory landscapes, corporate commitment to sustainability remains strong. Over 10,000 companies and institutions—representing a 29% year-over-year increase—have already set science-based decarbonization targets or committed to doing so. Additionally, 24 U.S. states and over 190 countries continue to align with the Paris Climate Agreement, demonstrating a global effort to combat climate change.

This determination is an indication that sustainability is no longer merely a compliance matter—it is now a fundamental business necessity. Firms that incorporate sustainability into their investment strategies are preparing themselves for long-term success, while those who wait risk forfeiting investor confidence and market share.

With the corporate world walking through changing rules and economic problems, the outcomes of the Workiva research send one message loudly and clearly: sustainability reporting has come to stay. Organizations which adopt integrated reporting, emphasize openness, and tie themselves down to science-based objectives will not just satisfy investors' expectations but additionally foster higher business resilience and profitability in the times to come.