90% of CFOs say ESG issues will be a key focus over the next 5 years.
IIn this article, published on CFO.com, the growing importance of ESG (Environmental, Social, and Governance) in the responsibilities of CFOs is highlighted, along with the need to proactively invest in both technology and talent development to remain successful in an increasingly demanding regulatory environment.
Key Insights for CFOs from the Article:
ESG Becoming a Major Focus for CFOs: More than 90% of the surveyed CFOs expect ESG issues to be a significant focus over the next five years. This underscores the increasing pressure from various stakeholders, such as investors, regulators, and board members, to take action on sustainability.
Pressure from Stakeholders: Four out of five CFOs (81%) feel pressure from at least three different stakeholder groups to take more action on sustainability. Regulators and board members are mentioned as the largest sources of pressure.
Opportunities through New Technologies: Although the pressure to comply with new ESG regulations is increasing, this also presents opportunities. Companies can leverage new technologies to gather better information, make smarter business decisions, and create value from sustainability.
Developing Capabilities: To go beyond mere regulatory compliance and to gain a competitive advantage, companies need to develop various technology- and talent-based capabilities. This includes automating ESG data collection, integrating ESG data into business decisions, and building skills within both financial and sustainability teams.
Strong vs. Weak ESG Capabilities: Only about 15% of companies have strong ESG measurement and management capabilities. Companies with strong capabilities succeed in automating ESG data, using predictive analytics, and fostering collaboration by developing complementary skills within their teams. These companies also face fewer challenges in balancing sustainability with profitable growth.
Sources: https://www.cfo.com/news/esg-issues-major-focus-next-5-years/721405/"90% of CFOs say ESG issues will be a major focus over the next 5 years."
