What are listed firms' most prominent challenges to implementing ESG strategies in 2023?
Nasdaq's 2023 ESG & Climate Survey provides a comprehensive overview of the current state of ESG and sustainability practices among listed companies.
This survey of 100 decision-makers from several geographical areas and business sectors highlights that:
- Nearly half of the companies have been addressing ESG and sustainability topics for fewer than three years, while only 9% have been doing so for more than five years.
- 62% of executives regard product stewardship as very important to their business, making it the most significant ESG theme.
- The most significant challenge to the implementation of an ESG strategy for 34% of companies is the execution of external reporting.
- At least two-thirds of respondents are planning to invest in software to facilitate a wide range of ESG and sustainability processes.
- 47% of businesses are implementing their strategies to mitigate ESG and climate risk, with a further 19% having already implemented best practices for ESG and climate risk mitigation.
- The most significant barriers to investment in ESG tools are poor integration of solutions with incumbent systems (56%) and a lack of suitable solutions (50%).
With the CSRD coming into force, it is clear that many ESG decision-makers are not yet well prepared to manage the full breadth and complexity of ESG issues.
The emerging ESG regulation, added to the fact that teams are not always large and well-trained enough, presents a challenge to the implementation of ESG strategies.