Investor Confidence Boosted by Expansion of Third-Party Assurance, Says OECD. ESG Broadcast Shares Key Takeaways.
Key Extract
The Organisation for Economic Co-operation and Development (OECD) released its Global Corporate Sustainability Report 2025 detailing recent shifts in global market practices. The report highlighted substantial global progress in corporate sustainability disclosure between the years 2022 and 2024. Disclosure expanded significantly during this period to cover a strong 91% of global market capitalization. This notable growth reflected companies recognizing and actively responding to crucial environmental and social trends.
Approximately 12,900 listed companies worldwide actively disclosed their vital sustainability-related information during the year 2024. Companies representing 88% of market capitalization also reported their Scope 1 and 2 Greenhouse Gas emissions data for detailed analysis. Assurance practices for this material disclosed information also significantly expanded between the two latest reporting cycles. Assurance coverage for external third-party review reached 81% of the total global market capitalization.
The crucial issue of climate change risk was identified as financially material by listed companies representing 65% of global market capitalization. This essential recognition solidified climate change as a core financial and a significant strategic matter for all corporate boards to oversee. Board-level committees frequently oversaw significant sustainability risks, which was a noticeably increasing trend worldwide. Two-thirds of all companies linked executive compensation directly to measured sustainability factors in 2024.
The critically important energy industry exhibited the world’s highest rate of comprehensive sustainability-related disclosure among all corporate sectors at 94%. This sector was central as both a massive global greenhouse gas emitter and a critical enabler of the necessary clean energy transition. Yet, a substantial concern emerged regarding the sector’s long-term and capital expenditure investment priorities. Investment growth was significantly outpaced by rapidly rising dividend payments and substantial share buybacks.
Strategic significance lies in the continuous effort to strengthen investor confidence and ensure better comparability of essential corporate sustainability disclosures moving forward. Policymakers considered encouraging a reasonable level of assurance for fundamental Scope 1 and 2 emissions data to enhance both data reliability and credibility. Adoption of the new International Standard on Sustainability Assurance (ISSA) 5000 was strongly recommended for greater worldwide consistency. Interoperability among different reporting frameworks could also effectively reduce company compliance costs significantly.
