Chapter 11: Recent Developments in ESG Reporting

Paul A. Davies, Paul M. Dudek, and Kristina S. Wyatt


Environmental, social, and governance (ESG) issues have become a core business concern and a central focus of investors. The ESG reporting landscape is fragmented, with hundreds of reporting standards forming what has been called an alphabet soup of acronyms with no common framework to guide corporate disclosures. Companies’ ESG disclosures vary widely and investors complain that they do not have the comparable, decision-useful information that they need to properly factor ESG considerations into their investment decisions. For their part, companies express concern over the lack of guidance as to which disclosure standards to follow. The SEC’s reporting rules have remained essentially unchanged for decades even amid calls for reform. At the same time, organizations, including the World Economic Forum, have called for efforts to bring consistency and comparability to ESG disclosures. This chapter explores this dynamic landscape and anticipates significant change in the regulation of ESG reporting over the coming years.