Dive Brief:

• Nearly three out of five executives (58%) say their companies engage in “greenwashing” by exaggerating efforts to curb harm to the environment from their products, services or operations, according to a global survey sponsored by Google Cloud.
• Many executives would “like to see better accountability and action” on sustainability, with 36% of respondents saying that their companies have measurement tools for quantifying sustainability performance and just 17% saying the measures are used to improve outcomes, Google Cloud said.
• Thirty-five percent of U.S. executives, and 29% worldwide, agree with the phrase, “my company treats sustainability like a PR stunt,” according to the survey by Harris Poll of 1,491 CFOs and other executives in the C-suite or VP level across 14 markets.

Dive Insight:

CFOs face mounting pressure from investors, regulators, lawmakers and other stakeholders to adopt environmental, social and governance (ESG) best practices.

For example, investors with $130 trillion in assets under management have asked companies to disclose their climate risks, according to SEC Chair Gary Gensler.

The SEC chief last month released an agency proposal that companies follow detailed rules for reporting on climate risk. Both businesses and investors will benefit from clear, uniform disclosures on the costs from global warming, he said.

The Google-sponsored survey reveals that many companies lack the knowledge, technology, authenticity and commitment to track and publicize efforts to promote sustainability.

Nearly nine out of 10 (87%) “of respondents said that if business leaders can be more honest about the issues they face with becoming more environmentally sustainable, they can make more meaningful progress,” according to a Google Cloud description of the survey results.

Four out of five (82%) of the respondents agreed with the statement, “I wish our board or senior leadership gave us more room to prioritize sustainability.”

Gensler wants publicly-traded companies to make reporting on climate risk a priority.

Under its recently released proposal, the SEC would require companies to describe on Form 10-K their governance and strategy toward climate risk and their plan to achieve any targets they’ve set for curbing such risk.

Companies would need to disclose their greenhouse gas emissions, either from their facilities or through their energy purchases, and obtain independent attestation of their data and estimates.

The SEC would also require some companies to report on so-called Scope 3 emissions by their suppliers, vendors and other third parties across their supply chains. The reports would be phased in, subject to safe harbor protections and not required of smaller companies. The initiative is subject to a public comment period scheduled to end May 20.

To be sure, CFOs and other C-suite leaders have awakened to the pressure for better ESG tracking and performance, according to the survey conducted from Dec. 21 until Jan. 8.

ESG initiatives are a leading priority with two-out of three executives (64%), on par with “adjusting business models” and above such efforts as “optimizing customer experience,” driving revenue, and research and development, Google said.