Sustainability Reporting: Challenges and Solutions for Financial Institutions

Survey results from 2025 indicate that 47% of respondents believe enhanced technology use would improve reporting. Additionally, 46% suggest earlier data validation and completion could be beneficial.

Financial institutions should view sustainability reporting, like ISSB, as a transformative initiative. This effort requires combining regulatory readiness with robust data, technology, and AI foundations for effective implementation.

To maximize strategic alignment, ISSB reporting should be integrated across various functions and executive levels within an institution. This approach prevents it from being solely a sustainability-compliance task, fostering broader engagement.

Respondents who have adopted or are considering ISSB standards identify anticipating financial impacts as their most significant compliance challenge. Specifically, 10 out of 22 for IFRS S1 and 8 out of 23 for IFRS S2 cited this as a major hurdle, underscoring difficulties in quantifying decision-useful financial effects.