October 26, 2023
Regulatory mandates and the challenges of sustainability reporting took center stage at a joint Climate Week event held by UL Solutions and KPMG Strategy.
During the event, attendees were briefed on what these new mandates mean for American businesses, followed by a demonstration of UL Solutions’ environmental, social and governance (ESG) reporting software to gain insight into how software streamlines data collection and reporting in the face of these new regulations.
The European Union’s (EU) new Corporate Sustainability Reporting Directive (CSRD) requires all large companies and all listed companies to disclose the environmental and social impact of their activities, along with the risks and opportunities companies face due to increased social and environmental issues. By 2028, over 50,000 organizations will be obligated to disclose under CSRD.
Additional legislation, such as the recently passed California Senate Bill 253, the Climate Corporate Data Accountability Act, and the expected November adoption of final rules on climate change disclosure by the United States (U.S.) Securities and Exchange Commission, will place new pressures on American companies, forcing many to launch their ESG disclosure programs now rather than later.
“As regulatory bodies act to meet stakeholder expectations, U.S. companies need to act as the landscape will only get more complicated,” said Simin Zhou, vice president of Strategy, Acquisitions and Partnerships at UL Solutions. “Investing in a comprehensive sustainability data and reporting platform is critical to navigating regulatory uncertainties.”
“Even companies with longstanding experience in sustainability reporting will require assistance,” said Steve Arnold, head of KPMG’s Financial Services ESG practice. “The CSRD alone requires disclosures on hundreds of metrics and targets across 12 sector agnostic European Sustainability Reporting Standards (ESRSs). It’s going to be a heavy lift for most companies1.”
The event closed with statements from leaders for both organizations and a re-emphasis on how software can be leveraged in combination with third-party advisors to get up to speed on these regulations quickly and easily, even for companies that have struggled to-date with how to begin their decarbonization journey.
1 Disclosure: Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.
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