Sustainability Reporting Becomes More Focused as Companies Strengthen Data Controls

Corporate sustainability reporting is entering a more disciplined phase as companies reduce unnecessary content, strengthen internal controls and concentrate on information that is relevant to investors, customers, regulators and other stakeholders.

That is the assessment of sustainability consultancy Anthesis, which argues that recent regulatory uncertainty and political opposition to environmental, social and governance policies have not brought corporate reporting activity to a halt. Instead, businesses are reassessing what they disclose, how they collect supporting data and which audiences their reports are intended to serve.

According to figures cited by Anthesis, 92% of companies in the S&P 500 and almost half of businesses in the Russell 3000 continued to publish sustainability reports in 2025. This was despite changing regulatory requirements, political pressure on ESG programmes and mixed signals from financial markets.

The findings indicate that sustainability reporting remains an important corporate function, but one that is becoming more closely managed. Reports are increasingly being treated as tools for communicating material business risks and performance rather than broad collections of environmental and social initiatives.

Anthesis identifies three main areas of change: more disciplined content selection, streamlined reporting formats and stronger data governance.

Companies Narrow the Scope of Disclosures

The first shift is towards a more deliberate selection of topics and metrics.

Companies are increasingly aligning disclosures with regulatory obligations, stakeholder expectations and their wider business strategies. Legal, finance, internal audit and sustainability teams are also working more closely together to evaluate which environmental and social issues could affect financial performance or create operational risks.

This process is partly being driven by the emergence of formal reporting standards. The EU’s Corporate Sustainability Reporting Directive, or CSRD, requires companies within its scope to evaluate sustainability issues using a double-materiality approach. This considers both how environmental and social factors affect the company and how the company affects people and the environment.

Standards developed by the International Sustainability Standards Board, or ISSB, have a narrower focus on sustainability-related risks and opportunities that could influence enterprise value and financial performance.

Although their approaches differ, both frameworks require businesses to conduct more structured assessments, document their assumptions and support disclosures with evidence. This is encouraging closer links between sustainability reporting, financial reporting, risk management and internal audit functions.

For companies, the practical effect is that disclosure decisions are becoming less dependent on what can easily be included in a report and more dependent on what is material, measurable and defensible.

Businesses outside the scope of mandatory reporting rules are also adopting similar practices. Anthesis says voluntary reporters are increasingly considering the information requested by investors, ESG ratings providers, procurement platforms, business customers and voluntary frameworks when deciding which indicators to publish.

Reports Become Shorter and More Accessible

A second development is the move towards shorter and more targeted reporting formats.

Anthesis estimates that many companies are reducing the amount of content in their main sustainability reports by around 20% to 30%. Others are replacing lengthy standalone publications with shorter strategy summaries, data sheets, online dashboards and separate case studies.

This does not necessarily mean that companies are disclosing less information. In some cases, data is being reorganised across several channels so that different audiences can find relevant information more easily.

Investors may require detailed emissions, risk and governance data, while customers may be more interested in product impacts, supply-chain practices or progress against environmental targets. Employees and local communities may require different information again.

A more structured reporting system can therefore include a concise corporate report supported by detailed datasets, regulatory filings and regularly updated digital content.

The emphasis on readability also reflects concerns that very long sustainability reports can obscure material information. Reports containing hundreds of indicators may appear comprehensive but can be difficult to assess, particularly where figures are not clearly connected to strategy, targets or financial consequences.

Data Governance Becomes a Central Requirement

The most significant long-term shift may be the growing focus on the quality and traceability of sustainability data.

Companies are investing in systems that can collect, validate and document environmental and social information across business units and supply chains. Responsibilities are increasingly being assigned to named data owners, while review and approval processes are being aligned with those used for financial information.

Anthesis says successful reporting programmes are characterised by executive ownership, reliable data, clear governance and preparation for external assurance. Assurance readiness should be built into reporting systems from the beginning rather than added shortly before publication.

This has important implications for carbon accounting. Companies making net-zero commitments must often collect energy, fuel, procurement, logistics and supplier data from multiple systems. Weak controls can lead to inconsistent emissions calculations, incomplete Scope 3 inventories and difficulty demonstrating progress against targets.

Better governance can also support operational decision-making. Reliable data allows companies to identify energy-intensive facilities, prioritize suppliers for engagement, evaluate capital expenditure and monitor whether decarbonization measures are producing the expected results.

Reporting is therefore increasingly functioning as part of a broader management system rather than simply as an annual communications exercise.

EU Changes Reduce Scope but not Stakeholder Demand

The transition is taking place as the European Union simplifies parts of its sustainability reporting framework.

The EU has postponed reporting deadlines for some companies and narrowed the proposed scope of the CSRD towards larger businesses. In July 2026, the European Commission also adopted amendments intended to simplify the European Sustainability Reporting Standards, although the delegated regulation must be published in the Official Journal before entering into force.

The regulatory changes may reduce compliance obligations for many smaller and medium-sized companies. However, those businesses may still receive sustainability data requests from larger customers, banks, investors and procurement platforms.

Large companies subject to mandatory reporting frequently depend on information from suppliers when calculating value-chain emissions and assessing environmental or social risks. As a result, organizations outside the direct scope of regulation may remain indirectly affected.

The situation also remains complex for multinational companies operating across jurisdictions. Reporting standards based on ISSB requirements are being introduced or considered in several markets, while companies with EU operations may still need to prepare information under European rules.

Practical Implications for Businesses

For corporate reporting teams, the immediate priority is to determine which requirements and stakeholder demands apply to the organisation and where they overlap.

Companies should establish clear ownership for sustainability data, document calculation methodologies and introduce appropriate internal controls. They should also assess whether existing software and financial systems can support sustainability information before investing in separate platforms.

Materiality assessments should be periodically reviewed as regulations, business models and stakeholder expectations change. Companies should also distinguish between information required for regulatory compliance and additional voluntary disclosures that provide commercial or strategic value.

Anthesis’ assessment suggests that the future of sustainability reporting will not be defined by the volume of published information. It will be defined by whether disclosures are relevant, supported by reliable evidence and connected to corporate decisions.

As reporting requirements mature, companies will face increasing pressure to demonstrate not only what targets they have set, but also how responsibilities are assigned, how progress is measured and how sustainability risks influence strategy and investment.

Source: sustainabilityonline.net