Three quarters of business leaders do not believe their peers’ ESG reporting, according to a new study, showing that a lack of industry trust and verifiable data is driving scepticism.
In fact, most business leaders (76%) in major industries doubt their peers’ Environmental, Social and Governance (ESG) reporting, satellite giant Inmarsat said, as the company shared its latest report with ESG Insight.
The findings come from Accelerating sustainable action through IoT, which includes the views around 1,000 senior technology and ESG decision-makers across agriculture, mining, transport, utilities and oil & gas firms.
The survey asked professionals about their perceptions on ESG and whether they believe ddata provided by ‘Internet of Things’ (IoT) solutions could help improve reporting transparency.
Respondents also report concerns about their peers’ ESG priorities, with 80% saying their competitors are more focused on perception rather than achieving tangible sustainability outcomes.
However, despite scepticism about the motivations of their peers, most business leaders have faith in their own initiatives: with 81% convinced their company is more sustainable than their competitors.
“You cannot manage what you cannot measure,” stressed Jat Brainch, Chief Commercial and Product Officer, Inmarsat. “To demonstrate progress, however, businesses must overcome their reluctance to share useful data and have the confidence to publish meaningful insights.”
Otherwise, they risk undermining genuine collaboration on sustainability and overshadowing the real progress being made, Brainch told ESG Insight.
“There is no quick fix, but creating methodical benchmarks based on actionable data, and sharing the results, will play a critical role in re-establishing trustworthy ESG reporting,” he added.
Lack of data drives lack of trust
The results suggest that a lack of verifiable hard data – and the willingness to share it – is undermining trust and slowing progress on business sustainability.
Positively, however, many believe data collected via IoT solutions is critical to building trust (81%) and improving ESG outcomes overall (82%).
Four in five respondents plan to increase their use of IoT solutions over the next 12 months to measure and understand the impact of their sustainability initiatives more accurately.
“You cannot manage what you cannot measure.”Jat Brainch, Inmarsat
A similar proportion reported they are already seeing return on investment from IoT tools used to improve sustainability (78%).
While the majority (83%) agree they could be doing more to effectively leverage IoT solutions to produce ESG data, engrained resistance to data sharing creates an additional barrier to progress.
Only 47% said they would be comfortable sharing all their ESG data with third parties to improve industry reporting and benchmarking over the next 1-3 years, reinforcing that improving trust will be key to achieving better outcomes.
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