Sustainability Reporting Grows Dramatically Among Multinationals

Sustainability Reporting Grows Dramatically Among Multinationals

The number of large multinational companies reporting corporate responsibility (CR) data has risen dramatically over the last three years, with vast majority doing so because of ethical reasons, according to new research from KPMG.

Nearly three-quarters of the top 100 U.S. companies by revenue reported sustainability data this year, twice as many as three years ago, KPMG has found. Eighty percent of the world's 250 biggest multinational companies divulge CR information, compared to 64 percent in 2005.

"More U.S. companies are beginning to see the link between profits and principles," Eric Israel, KPMG's advisory practice managing director, said in a statement. "Even in a difficult economy, we expect this trend to continue, as enhanced transparency and disclosure on non-financial matters will likely grow in importance."

The KMPG Internatational Survey on Corporate Responsibility Reporting reviewed the disclosures of more than 2,200 companies, including the Global Fortune 250 and 100 largest companies (N100) by revenue.

Although Israel called sustainability reporting mainstream, there is a gap in companies disclosing climate change risks. For example, 57 percent of the G250 address climate change business risks in reports, but 69 percent of N100 companies do not.

Sixty-four percent of G250 companies and 34 percent of N100 describe how they will mitigate climate change business risks. "With the majority of N100 companies not tracking risks and implementing mitigation programs, a major opportunity for better management of climate risk could be missed," the report said.

Forty-one percent of G250 and 62 percent of N100 companies fail to disclose their carbon footprint. United Kingdom companies lead in carbon footprint disclosure, followed by Japan, Sweden, France and Spain.