Beyond regulators

Companies worldwide face growing scrutiny of their environmental, social, and governance (ESG) reporting — and not just from regulators.

According to the KPMG ESG Assurance Maturity Index 2025, the top source of increasing pressure over the past two years has been financial markets. Players such as stock exchanges, index providers, and data aggregators have high expectations for the accuracy and reliability of sustainability information.

That’s one reason why companies are upping their use of managed services for sustainability reporting. According to the most recent KPMG and HFS Research Managed Services Outlook Survey, 78 percent of respondents anticipate an increase in their need for managed sustainability reporting over the next two years. Already, 71 percent are using managed services for more than half of their sustainability processes.

Standing up to scrutiny

Managed services for sustainability reporting help companies feel confident in their data amid intensifying expectations for transparency. In financial markets, these expectations include:

Standardized, comparable data

It’s difficult for the market to price risk without consistent data. That’s why index providers require standardized metrics and reporting frameworks to calculate sustainability scores. These scores are vital to a company's health because if sustainability data is non-standard or missing, it could result in a low score that affects investor confidence.
Real-time materiality

To clearly articulate the financial materiality of sustainability factors, stock exchanges expect companies to provide sustainability data with the same rigor and timeliness as financial data. Traders and market makers also utilize sustainability data to assess potential risks, such as regulatory fines or stranded assets, that could contribute to volatility.
Reduced greenwashing risk

When it comes to sustainable finance, the integrity of the practice depends on the reliability of the underlying data. For example, the market for green bonds and sustainability-linked loans requires clear, auditable sustainability metrics to verify that capital is being used as intended. In addition, central banks and financial stability boards increasingly view climate risks as systemic threats to the entire financial system, so they’re seeking reliable sustainability data to quantify the market’s risk exposure.

Reliable reporting

With managed services for sustainability reporting, companies can meet the requirements of not only the financial markets but also other critical stakeholders, including regulators, investors, customers, and boards of directors.

Leading providers combine data reviews, materiality assessments, metrics, quantifications, and more into a consolidated approach — all delivered in a fixed-price, subscription-based reporting service.