There has been a sharp rise in the number of Australian companies whose annual reports link their business activities to the United Nations’ Sustainable Development Goals (UN SDGs) since 2017, a KPMG global survey has shown. Bio-diversity is anticipated to be a key reporting development, looking ahead.
KPMG’s international sustainability reporting survey of over 5,000 companies in 52 countries shows the UN SDGs – covering global challenges such as poverty, inequality, climate change, peace and justice – have resonated with businesses since their inception five years ago and Australia’s top 100 firms, like overseas counterparts, have used their annual and sustainability reports to connect their activities with the most relevant goals to their business
In Australia, the goals which have generated most reporting include SDG 13 – Climate Action (75 percent); SDG 8 – Decent Work and Growth (69 percent); and SDG 5 – Gender equality (63 percent). Two-thirds (67 percent) of ASX100 companies now reference the SDGs in their reports, up from just 29 percent in KPMG’s 2017 survey, and not far from the 72 percent level of the G250, the world’s largest 250 companies.
Australia-based Adrian King, KPMG Global Chair of Sustainability, Climate Change and ESG Services Adrian King said: “The 2020’s are often called the ‘decade of action’ for the SDGs, and the ones prioritised by business often symbolise what topics are at the forefront of societal discourse. Since our last survey in 2017, wider stakeholders have begun to expect more of companies, which in turn have sought to prove their social licence to operate by connecting their activities to the SDGs.”
“Both here and globally, climate action and sustainable, inclusive economic growth are the top two goals, but gender equality appears to be a larger concern in Australia than the rest of the world (63 percent in Australia, compared with 43 percent globally). So does biodiversity – with 30 percent of ASX100 reporting SDG 15 – Life on Land as being relevant to their business compared to just 9 percent internationally. But there is still a long way to go here as only 17 percent state that biodiversity and nature loss is a risk to their business.
“With the Taskforce on Nature-related Financial Disclosures (TNFD) expected to be released in 2022-23, KPMG expects reporting on biodiversity to grow rapidly in the next few years, similar to the trajectory seen by climate risk in recent years.”
Overall, the KPMG global survey – and supplementary research by KPMG Australia – shows that sustainability reporting within the ASX100 has improved dramatically in the last three years. Australian companies have moved from laggard status in the 2017 survey, to a position now where a majority use the internationally-regarded Global Reporting Initative framework, and have sustainability information externally assured as well as linking activities to the SDGs.
KPMG’s Global survey reviewed the reporting of 5200 companies worldwide from 52 countries (N100) and compared these trends to the G250. The survey is carried out by KPMG member firm professionals who review corporate reporting by the top 100 companies in their country. KPMG Australia’s Supplementary research extends this research to compare to the ASX100.
This research is part of the same project as KPMG’s climate risk reporting study last month.
This the 11th edition of the KPMG Survey of Sustainability Reporting 2020 since it was first published in 1993. The survey is widely acknowledged as the most comprehensive and authoritative global research on sustainability reporting trends. In 2020, several KPMG member firms participated for the first time, indicating the growing importance of sustainability reporting in smaller markets: Ecuador, Iceland, Pakistan, Panama, Sri Lanka, Costa Rica, Argentina and Saudi Arabia.
1. The world’s 250 largest companies based on the Fortune 500 ranking.
2. The top 100 Australian companies by market capital.
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