Climate change’s impact gets clearer by the day: Rising temperatures, catastrophic weather events, spiking energy costs, and fundamental threats to basic human essentials like clean air and water.
None of which, of course, is good for business. But what remains less clear by the day is exactly how companies need to report out all of that bottom-line impact—on a consistent basis, and as part of clearly defined accounting procedures.
The Securities and Exchange Commission (SEC) released its much-anticipated initial proposal on climate reporting and assurance rules back in March, with a goal of having at least some new guidelines on the books for 2023. But, many months later, the final rules and an exact rollout timeline remain unclear amid ongoing discussions elongated by economic headwinds, political debate, and even some technology glitches on the SEC’s feedback tool.
It’s no wonder that just 17 percent of the companies in a recent KPMG survey said they felt prepared for the inevitable new SEC reporting requirements—even though 78 percent said they expect the new rules will mean more effort from their teams.
Clearly, a “watch-and-wait” approach is just not an option for most companies when it comes to responding to climate change and the broader emerging arena of environmental, social, and governance (ESG) issues. And that’s why KPMG has been actively working with clients to establish thorough ESG strategies that put them in the driver’s seat, and sooner.
Here’s how one of our leading-practice clients is doing it today.