Corporate sustainability reports are getting longer
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ESG has long been misunderstood and thus weaponized. As one corporate affairs leader said at a Climate Week lunch, "If we're using acronyms, we're losing."
Why it matters: In response, communication teams are finessing how these commitments are messaged and shared.
By the numbers: Executive advisory firm Teneo analyzed 250 sustainability reports from S&P 500 companies published between Jan. 1 – July 30 and found that while ESG reports very much live on, the pomp and circumstance surrounding their launch is dwindling.
- Less than half of the companies issued a press release to accompany the report, compared to the 75% that did so in 2021, and only 14% provided an executive summary of their reports, down from the 26% in years prior.
- Instead, more companies are investing in sustainability-focused micro-sites within their corporate websites.
Zoom in: According to the study, these ESG reports are getting longer — as attention spans are getting shorter — with most averaging 83 pages long.
- That's a 20% increase compared to the reports from 2021.
- The shortest 2024 report came in at 15 pages, while the longest was 211 pages.
The intrigue: Language has evolved as well. "Sustainability" overtook "ESG" as the most common key word within report titles, while the mention of "impact" nearly doubled since last year.
- 94% of companies continued to use the term "DEI" within reports, and the remaining 6% focused more broadly on themes of belonging and inclusion.
- Of note: Fewer companies are including a section highlighting the progress they've made toward reaching their goals than in years past, according to the report.
What they're saying: "ESG has been highly politicized. The term has been co-opted, and yet there is a lot of new EU regulation coming out," says Martha Carter, vice chairman and head of governance advisory at Teneo.
- "It's really about companies looking at this from a broader global perspective, and not just complying with regulatory components, but looking at it from a stakeholder assessment and from a business perspective."
What to watch: Roughly 1 in 5 mention the responsible use of AI in their 2024 reports.
- There are ethical and environmental considerations when it comes to AI. Expect to see more reporting as companies incorporate it into their work flows.
More on Axios: Why ESG isn't going away, despite all the noise
