This annual report: “The State of Play: Sustainability Disclosure & Assurance - Five Year Trends & Analysis” from the International Federation of Accountants (IFAC), the AICPA, and CIMA, reveals the results of a robust evaluation of sustainability disclosure and assurance practices among the 1,400 largest companies in 22 jurisdictions worldwide. US data is based on an analysis of the largest 100 companies by market cap as of April 2024 (i.e., reporting year 2023).
Disclosure
- Most US companies (65%) continued to rely primarily on standalone sustainability reports for their ESG disclosure in 2023; however, one-third included information in an annual report, which represents a significant increase from just 5% in 2022.
Assurance (For purposes of these statistics below, note that assurance over even one ESG metric counts as having obtained assurance.)
- 90% of US companies obtained assurance over some reported ESG information in 2023, compared to an average of 73% worldwide.
- 90% of US company assurance reports and most assurance reports worldwide were at the limited level in 2023. Worldwide, nearly two-thirds of reasonable assurance (8% of all assurance reports) covered only GHG metrics, while nearly 70% of limited assurance (82% of all assurance reports) covered social and governance metrics.
- Not unexpectedly, worldwide, reporting and assurance of Scope 3 GHG emissions lagged Scope 1 and Scope 2. Assurance of Scope 3 GHG emissions further varied by scope 3 emissions category, with a majority of companies obtaining assurance doing so with respect to Categories 6, 1, 3, 5, and 7, and 50% obtaining assurance over Category 4.
- US companies obtained assurance largely from service providers other than audit firms in 2023, with audit firms comprising less than 30%, the lowest percentage use worldwide other than South Korea.
- ESG-assured information lagged companies’ annual reports by 115 days on average in the US, which exceeded the number of days in all other jurisdictions covered.
Standards/Frameworks
- The vast majority of US companies (94%) referenced or used multiple reporting standards / frameworks in 2023. Further, more than 90% referenced or used the SASB standards and nearly 90% referenced or used the TCFD Framework compared to averages of 55% and 73%, respectively, worldwide. In contrast, the US lagged the worldwide averages in referencing or using the GRI Standards and SDG Standards at about 70% each compared to worldwide averages of 80% and 85%, respectively.