Key global trends in sustainability reporting

Global sustainability reporting reaches near-universal adoption among large firms

Sustainability reporting has shifted from niche practice to corporate standard. KPMG’s 2022 Survey of Sustainability Reporting found that 96% of the world’s 250 largest companies now publish sustainability information. Among the top 100 firms in each of 58 countries, the figure stood at 79%. These numbers mark a significant change from 1993, when just 12% of companies issued sustainability reports.

The findings matter because they reflect a broader commercial shift. Disclosure is no longer voluntary for most large organizations. Instead, it has become a baseline expectation driven by regulation, investor demand, and supply chain requirements. For UK businesses working with multinational clients or competing for contracts that include environmental criteria, understanding how reporting standards are applied globally is increasingly relevant.

KPMG has tracked corporate sustainability disclosure for decades. The 2022 survey analyzed reporting practices across major economies and identified five key trends. Companies are building more reports around formal materiality assessments. Climate-related risks and carbon-reduction targets are receiving stronger disclosure. Biodiversity risk is attracting rising attention. Reporting against the Sustainable Development Goals emphasizes quantity over quality. Climate risk disclosure is outpacing social and governance topics.

These patterns signal a reporting environment where certain issues dominate. Consequently, businesses that supply larger firms or seek public sector contracts may face questions about their own climate data, materiality processes, and reporting frameworks. The global picture influences what becomes standard practice in UK supply chains.

KPMG examined three major reporting approaches in its survey: the Global Reporting Initiative (GRI), the Sustainability Accounting Standards Board (SASB), and country-specific stock exchange guidelines. GRI remained the most widely adopted standard. It was used by 68% of the top 100 firms surveyed in each national market and 78% of the world’s 250 largest companies. The Americas showed the strongest uptake of SASB. Nearly one-quarter of companies in both groups used domestic stock exchange guidelines or standards.

The persistence of multiple frameworks creates complexity for businesses. However, it also reflects different regional priorities and regulatory environments. European companies face a dense regulatory landscape, with 245 ESG reporting instruments identified in related KPMG research. Asia had 174 such instruments, while North America had 47. The variation means that UK firms operating internationally or supplying global customers must navigate diverse disclosure expectations.

Materiality assessments are becoming central to reporting practice. KPMG found that 71% of the top 100 firms in national markets and 77% of the world’s largest companies were conducting these assessments. A materiality assessment identifies which sustainability issues are most significant to a business and its stakeholders. This process helps companies focus reporting on topics that genuinely affect financial performance, operational risk, or stakeholder trust.

For smaller UK businesses, materiality assessments are less common but increasingly useful. They provide a structured way to prioritize sustainability work and demonstrate to clients or procurers that resources are directed toward issues that matter. As larger firms refine their own materiality processes, they are more likely to ask suppliers for evidence of similar rigor.

Climate-related risks and carbon-reduction targets received stronger disclosure in the 2022 survey. This trend aligns with regulatory developments in the UK and EU, where climate reporting requirements have expanded significantly. Meanwhile, biodiversity risk is gaining attention. This reflects growing awareness of nature-related dependencies and impacts, particularly in sectors such as agriculture, construction, and manufacturing.

Reporting on the Sustainable Development Goals was widespread but often lacked depth. KPMG noted that companies emphasized quantity over quality in their SDG disclosures. Many organizations referenced multiple goals without explaining how their activities contributed to specific targets or how progress was measured. This gap suggests that SDG reporting remains more aspirational than analytical for many firms.

Integration of sustainability information into annual financial reports is another notable development. KPMG found that 60% of the top 100 firms in national markets included sustainability data in their financial reports. Among the world’s 250 largest companies, the figure was 68%, down eight percentage points from 2020. The decline among the largest firms may reflect a shift toward separate, more detailed sustainability reports rather than integrated documents.

Independent assurance of sustainability data is becoming more common. Close to half of the top 100 firms in national markets obtained third-party assurance for their sustainability reports. Assurance among the world’s largest companies increased in 2022 after a prior decline. This trend is significant because assurance adds credibility to reported data and reduces the risk of greenwashing accusations.

For UK businesses, the rise of assurance has practical implications. Public sector procurement increasingly favors suppliers with verified carbon data. Similarly, large corporate clients may require assurance as part of their own Scope 3 emissions reporting. Businesses that anticipate these requirements can avoid delays and demonstrate maturity in their sustainability approach.

Public trust in corporate sustainability communication reached 51% in related KPMG polling, the highest level recorded. This figure suggests that disclosure practices are gaining credibility even as regulatory expectations increase. However, it also highlights that nearly half of respondents remain skeptical. Trust is built through consistent, verifiable reporting rather than broad commitments or selective disclosure.

The regulatory landscape continues to evolve rapidly. Europe remains the primary driver of ESG disclosure requirements, with frameworks such as the Corporate Sustainability Reporting Directive setting new benchmarks. UK companies exporting to the EU or supplying European firms must understand these rules. Additionally, domestic requirements are expanding, particularly for quoted companies and large enterprises.

Smaller businesses often fall outside mandatory reporting regimes. Nevertheless, they encounter disclosure expectations through supply chains, tenders, and customer requirements. A manufacturing business supplying a large retailer may be asked for carbon data. A service provider bidding for a public contract may need to demonstrate compliance with Procurement Policy Note 06/21. A construction firm working on a major project may face questions about biodiversity impact.

The KPMG survey underscores that sustainability reporting is no longer optional for large companies. Furthermore, it shows that climate risk, materiality, and standardized frameworks are becoming the core architecture of corporate disclosure. These developments shape how performance is measured and how businesses are evaluated by regulators, investors, and procurement teams.

Five trends reshaping corporate sustainability disclosure

KPMG identified five major trends in its 2022 survey. First, more companies are building reports around formal materiality assessments. This shift reflects a move away from generic sustainability statements toward focused disclosure on issues that affect business performance and stakeholder interests.

Second, climate-related risks and carbon-reduction targets are receiving stronger, more detailed disclosure. Companies are under pressure from investors, regulators, and customers to provide transparent data on emissions, climate risks, and decarbonization plans. This trend aligns with frameworks such as the Task Force on Climate-related Financial Disclosures, which is being adopted or mandated in multiple jurisdictions.

Third, biodiversity risk is attracting rising attention. The Taskforce on Nature-related Financial Disclosures is gaining traction, and companies in sectors with significant land use, resource extraction, or ecosystem dependencies are beginning to report on nature-related risks. This area is less mature than climate reporting but is developing quickly.

Fourth, reporting against the Sustainable Development Goals emphasizes quantity over quality. Many companies reference multiple SDGs without providing robust evidence of contribution or progress. This pattern suggests a gap between aspiration and accountability.

Fifth, climate risk disclosure is outpacing social and governance topics. While social issues such as labor rights, diversity, and community impact remain important, they receive less detailed reporting than climate-related matters. This imbalance may reflect the relative maturity of climate frameworks and the intensity of regulatory focus on carbon reduction.

Why reporting standards and frameworks still vary

Despite the growth of sustainability reporting, no single global standard dominates. GRI remains the most widely used framework, particularly in Europe. SASB has stronger uptake in the Americas, where it aligns with investor-focused disclosure traditions. Stock exchange guidelines are also significant, especially in markets where regulators have introduced mandatory ESG reporting for listed companies.

The persistence of multiple frameworks creates challenges. Companies operating internationally must decide which standards to adopt or whether to report against several simultaneously. This complexity increases costs and creates potential for inconsistency. However, it also reflects legitimate differences in regional priorities, regulatory traditions, and stakeholder expectations.

Efforts to consolidate reporting standards are underway. The International Sustainability Standards Board, established under the IFRS Foundation, is developing a global baseline for sustainability disclosure. These standards are expected to focus on investor needs and are likely to influence corporate reporting in many jurisdictions. Nevertheless, regional frameworks will continue to play a significant role, particularly in Europe where the Corporate Sustainability Reporting Directive sets detailed requirements.

For UK businesses, the practical question is which frameworks to prioritize. Companies supplying European clients or operating in EU markets should understand GRI and the emerging EU taxonomy. Businesses with US investors or customers may encounter SASB. Those focused primarily on the UK market should track domestic developments, including mandatory climate reporting under the Companies Act and requirements related to public procurement.

What the survey data reveals about current practice

• Sustainability reporting among the world’s 250 largest companies reached 96%, while 79% of the top 100 firms in 58 national markets published sustainability information.
• GRI was adopted by 68% of national top 100 companies and 78% of the global 250 largest firms, making it the most widely used reporting standard.
• Materiality assessments were conducted by 71% of national top 100 companies and 77% of the global 250 largest firms, indicating a shift toward focused, stakeholder-relevant disclosure.
• Independent third-party assurance was obtained by close to half of national top 100 companies, with assurance rates among the largest firms increasing in 2022.
• Europe had 245 ESG reporting instruments, Asia had 174, and North America had 47, reflecting significant regional variation in regulatory density.
• Public trust in corporate sustainability communication reached 51%, the highest level recorded, though nearly half of respondents remained skeptical.
• Climate-related risks and carbon-reduction targets received stronger disclosure, while biodiversity risk attracted rising attention as a material issue.

How these shifts affect UK businesses outside mandatory regimes

Most UK small and medium businesses are not required to publish sustainability reports. However, the KPMG findings are still relevant because large companies increasingly expect sustainability data from their suppliers. Public sector procurement rules require carbon reduction plans and net-zero commitments for contracts above certain thresholds. Private sector clients may ask for emissions data, environmental management evidence, or alignment with specific frameworks.

These expectations flow down supply chains. A manufacturer supplying a multinational corporation may be asked to provide Scope 1 and Scope 2 emissions data. A logistics provider bidding for a contract with a large retailer may need to demonstrate carbon reporting capability. A construction subcontractor working on a major project may face questions about waste management, biodiversity impact, or energy use.

The rise of materiality assessments among large firms also has implications for suppliers. If a major customer identifies supply chain emissions as a material issue, it will likely request detailed carbon data from its suppliers. Similarly, if biodiversity risk becomes material for a client, businesses with significant land use or resource extraction activities may face new disclosure requests.

Assurance is another area where supply chain requirements are increasing. Large firms seeking third-party assurance for their own reports need reliable data from suppliers. This means that businesses providing emissions data or sustainability information may be asked to verify that data through independent review. Early preparation can prevent delays and demonstrate credibility.

Understanding which reporting frameworks are most relevant is important. A business supplying European clients should be familiar with GRI and the EU taxonomy. A firm working with US-based multinationals may encounter SASB. Domestic clients may reference UK-specific guidance or frameworks aligned with public procurement rules.

The shift toward standardized, assured, and investor-relevant reporting means that sustainability data is becoming more comparable and more scrutinized. Businesses that treat disclosure as a compliance exercise rather than a strategic process risk falling behind. Conversely, those that build robust data collection, materiality analysis, and reporting capability are better positioned to meet client expectations and compete for contracts.

Building reporting capability before it becomes mandatory

Businesses that anticipate future disclosure requirements can act now to develop reporting capability. This approach reduces risk, saves time when requirements are introduced, and demonstrates maturity to clients and procurers. Several practical steps are relevant regardless of company size or sector.

Start by understanding which sustainability issues are material to your business. This does not require a formal materiality assessment in the early stages. Instead, consider which environmental, social, or governance topics are most likely to affect your operations, customers, or supply chain. Climate risk and carbon reduction are priorities for most businesses. Other issues may include waste management, water use, labor practices, or biodiversity impact depending on your sector.

Once material issues are identified, focus on data collection. Emissions reporting requires reliable data on energy use, fuel consumption, and business travel. Waste reporting needs data on volumes, types, and disposal methods. Social reporting may require information on employment practices, training, or community engagement. Establishing data collection processes early makes reporting easier when it becomes necessary.

Consider whether third-party assurance will be required. If your business supplies large firms or bids for public contracts, assurance may become a client or procurer expectation. Understanding what assurance involves and what data quality standards it requires helps avoid problems later.

Familiarize yourself with relevant reporting frameworks. GRI is widely used and provides comprehensive guidance on sustainability topics. The Streamlined Energy and Carbon Reporting framework is mandatory for many UK companies and offers a useful template for others. The Greenhouse Gas Protocol provides the standard methodology for carbon accounting. Understanding these frameworks helps ensure that your reporting aligns with client expectations and regulatory requirements.

Engage with industry bodies and trade associations. Many sectors have developed specific guidance or benchmarks for sustainability reporting. These resources can provide practical advice tailored to your industry and help identify emerging disclosure trends.

Finally, consider whether external support is needed. ESG compliance and carbon reporting services can help businesses establish data collection systems, conduct materiality assessments, and prepare reports that meet client or regulatory requirements. Early investment in capability-building reduces the cost and complexity of reporting over time.

Where to find authoritative guidance and resources

The UK government provides guidance on greenhouse gas reporting through the Department for Energy Security and Net Zero. The government conversion factors for company reporting are updated annually and provide the data needed to calculate emissions from energy use, transport, and other activities. These factors are widely used in UK carbon reporting and align with international standards.

The Global Reporting Initiative publishes comprehensive standards for sustainability reporting. The GRI Standards are free to access and cover a wide range of environmental, social, and governance topics. They are widely used internationally and are recognized by investors, regulators, and procurers.

The Greenhouse Gas Protocol provides the most widely used methodology for corporate carbon accounting. The GHG Protocol website offers detailed guidance on calculating Scope 1, Scope 2, and Scope 3 emissions. Understanding this methodology is essential for businesses reporting carbon data to clients or preparing for mandatory disclosure.

The UK government’s Procurement Policy Note 06/21 sets out requirements for carbon reduction plans in public sector contracts above £5 million per year. Businesses bidding for these contracts must submit a carbon reduction plan that meets specific criteria. The guidance explains what is required and how to prepare a compliant plan.

The International Sustainability Standards Board is developing global baseline standards for sustainability disclosure. The ISSB website provides updates on these standards and their adoption. While primarily aimed at large, listed companies, the standards are likely to influence reporting expectations more broadly.