Sustainability is now a mainstream concern for organisations and their stakeholders, but they require clarity and guidance on sustainability reporting standards and practices.
An Intertek survey of UK firms found that investors, regulators, government, employees and the wider public now expect more from organisation – something that's recognised by 74% of c-suite executives.
Additionally, 83% of survey respondents agree that government and politicians are taking sustainability performance improvements seriously; 79% believe employees are becoming more aware of the issue; and 83% of the general public are also doing so.
"The world is changing at the speed of light in multiple directions, increasing the complexity of companies' operations and in response, stakeholders are seeking genuine reassurance that corporations take an end-to-end sustainability approach across their entire value chain,” comments Intertek CEO André Lacroix.
However, organisations' value chains can often span multiple countries, with different inherent risks at each level.
According to the survey, 65% of respondents find it difficult to understand the supply chain beyond those with whom they are in direct contact. Furthermore, 57% simply do not know how to assess relationships with companies in their supply chain.
Through this lack of knowledge, 76% of respondents believe their organisations are taking on extra risk by not assessing their entire supply chain. Almost all respondents (90%) admitted that some parts of their supply chains would receive a poor sustainability report if they were audited in depth.
To deal with this problem, three quarters of respondents say they would benefit from a simplified audit programme that could benchmark and assess their company's sustainability footprints.
Lacroix continues, "C-suite decision-makers recognise there are greater demands from all angles to improve their sustainability performance and disclosures and our research shows that 71% believe there are currently too many reporting standards. This is the paradox facing executives, as they need a way to authenticate the sustainability they are building into the fabric of their businesses.
"With supply chains becoming ever more complex, the importance of managing risk at every level has only grown in importance. In short, companies want a better way to navigate the multitude of reporting standards that exist and evidence their commitment to end-to-end sustainability as a corporation."
The research with UK companies was conducted online by FTI Consulting from 30 August to 3 September 2019 with 550 business leaders. Respondents were profiled by size (SME and large companies), industry and type of company (private or publicly listed).