LSHC ESG reporting: Progress, challenges, and regulations
Many companies in the LSHC industry have incorporated ESG goals into their operations, recognizing its importance to both the public and their stakeholders—recognition that underscores the importance of formal ESG and climate reporting. <a href="https://dart.deloitte.com/USDART/home/publications/deloitte/heads-up/2024/sec-climate-disclosure-requirements-ghg-emissions-executive-summary#SL885025642-681495" target="_blank">The U.S. Securities and Exchange Commission's (SEC) March 6, 2024, rule</a><sup>1</sup>; the Corporate Sustainability Reporting Directive (CSRD); California’s climate laws; and other similar regulations require that companies review and understand how they are affected by the regulations and what they are required to disclose as a result, and understand the importance of implementation of controls around ESG reporting and effective dates of the various standards.<br><br>In January 2024, we surveyed 250 company LSHC executives about the progress they’ve made in achieving their ESG goals and implementing the various regulations. This was a part of a larger, multi-industry Deloitte ESG survey, which probed across a variety of topics, including data challenges, assurance readiness, leadership, and more. We found specific differences in how the LSHC industry is progressing in those areas. Explore detailed insights into the current state of ESG readiness in the LSHC industry.
ESG report insights
Taking initiative: Planning your own ESG journey
Trust in leadership is one central consideration to the success of the LSHC industry's approach to ESG-related matters and the expectations set by a company's various stakeholders. This demand for accountability has triggered a heightened focus on ESG disclosures, typically leading to more rigorous scrutiny from both stakeholders and regulators on how companies are tackling ESG challenges internally and externally.
Regardless of your company's current state, it's important to consider being proactive about tackling these challenges. Where can you start?
![supporting list image](/content/dam/html/us/audit/2024/esg-industry-cut-lshc/microscope.jpg)
According to the results of our survey, LSHC companies are working toward achieving their ESG goals despite the data challenges they face and the differences they share regarding ESG disclosure oversight responsibilities and progress toward ESG goals. If your company is faced with the task of understanding and effectively implementing evolving ESG disclosure requirements, the good news is you're likely not starting from zero. The groundwork you've laid for ESG can be applied in a comprehensive manner to meet disclosure requirements, thereby helping to foster efficiency and manage risk.
Delaying action might hinder progress and could leave you scrambling for resources when you decide to act. Reach out to one of our experienced advisers to assess if you're equipped with the breadth and depth of knowledge that may be necessary to exceed what stakeholders and regulators expect of you.
Explore the life sciences and heath care industry report
ESG SelfAssess™
For both public and private companies, ESG readiness is a unique and fast-evolving journey. Our ESG SelfAssess™ tool is here to advise you as you navigate yours. Explore how to open the door for a more defined and enhanced reporting process.
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Methodology
The Deloitte ESG Survey was conducted by Wakefield Research (www.wakefieldresearch.com) among 300 Executives at publicly owned companies with a minimum annual revenue requirement of $500 million or more. Executives are defined as Senior Finance, Accounting, Sustainability, and Legal Executives with a minimum seniority of director, or Chief Risk Officers, General Counsels, Chief Legal Officers or Chief Sustainability Officer. Oversample interviews were conducted to increase the total sample size to 250 public and private companies in each of the following industries: Life Science and Healthcare; Financial Services; Consumer Products; Technology, Media & Telecommunications; Energy & Utilities. The survey was fielded between January 4th and January 18th, 2024, using an email invitation and an online survey.
Data rounding
Percentages throughout survey may not sum to 100% due to rounding.
Endnote
1 On April 4, 2024, the SEC voluntarily stayed the effective date of the final rule pending judicial review of petitions challenging it, which have been consolidated for review by the US District Court of Appeals for the Eighth Circuit. The SEC stated that it “will continue vigorously defending the [climate rule's] validity in court” but issued the stay to “facilitate the orderly judicial resolution of” challenges presented against the climate rule and to avoid “potential regulatory uncertainty if registrants were to become subject to the [climate rule's] requirements” before the legal challenges were settled. The stay does not reverse or change any of the final rule's requirements nor does it affect the SEC's existing 2010 interpretive release on climate change disclosures. For additional details, read Deloitte's “Comprehensive Analysis of the SEC's Landmark Climate Disclosure Rule.”
iAmanda K. Beggs, Promoting human rights and environmental sustainability: Integrating ethics into the supply chain,” National Law Review, March 26, 2024.
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