Walk the talk with regulatory confidence

In recent years, the sustainability reporting landscape has been transformed. Companies are no longer judged solely on financial performance; supervisors and stakeholders are now demanding transparency, accountability and measurable progress on environmental, social and governance (ESG) commitments. The proliferation of sustainability reporting standards has enabled organisations to communicate their targets and achievements in a more structured way. However, as regulatory requirements tighten and supervisory expectations rise, the challenge is not just to ‘talk the talk’, but to truly ‘walk the talk’—delivering on ESG promises with accuracy, consistency and resilience. How prepared is your organisation?

The evolution from voluntary to mandatory reporting regulation

Historically, sustainability reporting was largely voluntary. Companies chose to disclose information to enhance their reputation and respond to stakeholder expectations. Voluntary frameworks provide principles on what to report, enabling organisations to craft sustainability narratives and set ambitious targets. Yet the voluntary nature of these disclosures often led to inconsistencies in scope, methodologies and data quality.

Today, the regulatory environment is shifting rapidly. Frameworks continue to evolve, and companies are required to provide investor grade, reliable ESG data for their operations and supply chains. The shift from voluntary to mandatory reporting introduces new complexities and risks, including non compliance (such as inaccurate reporting or greenwashing), data quality and integrity issues, and operational and resource strain.

Reporting fatigue: navigating ESG frameworks and standards

The transition from voluntary to mandatory reporting is creating reporting fatigue. This shift demands more than compliance; it requires a strategic approach to sustainability reporting. Frameworks offer guidance on materiality, transparency, and accountability, helping organisations navigate overlapping standards and optmize reporting efficiency. Undestanding the interoperability between standards and frameworks is crucial to comply with sustainability regulations.

GRI (Global reporting initiative): Broad, stakeholder focused sustainability reporting framework.
TCFD (Task Force on Climate-related Financial Disclosures): Climate risk and opportunity reporting, with emphasis on governance and strategy.
CDP (Carbon disclosure project): Disclosure framework for environmental impacts-related information.
UNGC (United National Global Compact): Universally accepted human rights, labour, environment and anticorruption principles.
Equator principles: Principles for environmental and social risk management.
UN PRI (United Nations Principle for Responsible Investment): Principles incorporating ESG factors in investment and ownership decisions.

SASB (Sustainability Accounting Standards Board): Industry specific, investor focused ESG disclosures.
GRI (Global reporting initiative): Broad, stakeholder focused sustainability reporting framework.
ISSB (International Sustainability Standards Board): Seeks to unify global sustainability disclosure standards.
ESRS (European Sustainability Reporting Standards): EU-driven, detailed ESG disclosures covering both impact and financial materiality.

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The data challenge: complexity, diversity and accuracy

At the heart of effective ESG reporting lies data—data that must be accurate, coherent, consistent and compliant across the organisation. Collecting, managing and controlling this data is a formidable challenge, especially for global companies with decentralised operations. ESG data is inherently diverse, originating from multiple departments (manufacturing, operations, human resources, supply chain), multiple regions and external partners. Each data point—whether it relates to emissions, water use or social impact—may be measured using different metrics, systems and methodologies.

Moreover, as data flows from local operations to regional clusters and then to central reporting functions, it undergoes multiple layers of aggregation and consolidation. Without structured data governance, clear processes and robust controls—underpinned by regulatory requirements—the risk of errors, inconsistencies and inaccuracies increases, undermining the credibility of the final sustainability report.

Governance, controls and the path to reliable ESG regulatory reporting

To address these risks, companies must move beyond ad hoc data collection and compliance exercises. The foundation of a resilient ESG strategy is a comprehensive, compliant data framework—one that defines data requirements, maps sources and establishes clear processes for data extraction, generation, adjustment, transfer, review, consolidation and reporting.

At each stage of the data journey, robust controls are essential. This includes compliant review processes (such as the four eyes principle), spot checks and both manual and automated validation mechanisms. Integrating ESG legal requirements into the internal controls' framework—mirroring the rigour of financial reporting—helps ensure that sustainability data is accurate, compliant and defensible.

Technology plays a critical role. By leveraging automation, analytics and modern information systems, companies can streamline data collection, reduce manual effort and improve the speed and accuracy of reporting. Realtime data visualisation and analytics help teams identify trends, flag anomalies and make informed decisions—turning ESG data from a compliance burden into a strategic asset.

Realtime data visualisation and analytics help teams identify trends, flag anomalies and make informed decisions—turning ESG data from a compliance burden into a strategic asset.

Navigating regulatory complexity and managing risks

The regulatory environment for sustainability reporting is increasingly intricate and dynamic. Organisations must comply with existing rules and prepare for what is coming next. This demands a forward-looking approach: understanding what ESG data will be required, how it will be measured and how industry peers are adapting to new legislation.

All sustainability claims must be substantiated by reliable data and transparent methodologies. Both over disclosure (providing excessive or irrelevant information) and under disclosure (omitting material ESG information) can expose organisations to regulatory penalties, legal liability and reputational harm. Maintaining stakeholder trust requires a balanced, accurate and well governed approach to ESG reporting, underpinned by robust data management and continuous monitoring of the regulatory horizon.

Building regulatory resilience: a step-by-step approach

To build regulatory resilience in ESG strategy and governance, companies should adopt a structured, phased approach that fully integrates the regulatory dimension, including evolving reporting standards, anti-greenwashing requirements, due diligence obligations and regulations affecting products, services and consumer protection.

Map the regulatory landscape in your territories and the expectations of local supervisors.

Begin by mapping all ESG regulatory data currently disclosed across reports (sustainability statements, voluntary disclosures, transition plans). Identify key regulatory data points based on the legislation you must comply with, the sources and the reporting frameworks. Ensure alignment with current and emerging requirements such as the Swiss Code of Obligations, article 964; the Corporate Sustainability Reporting Directive (CSRD); International Sustainability Standards Board (ISSB) standards; and sector specific rules.

Analyse the maturity of data collection processes, the reliability of data sources and the alignment of disclosed key performance indicators (KPIs) with published targets and commitments. Evaluate potential risks—reputational, regulatory and operational—with a focus on compliance with anti-greenwashing standards (for example, the European Union Green Claims Directive), due diligence regulations (such as the European Union Corporate Sustainability Due Diligence Directive (CSDDD)) and product and service-related obligations.

Focus on areas where data complexity, regulatory requirements or stakeholder expectations are highest. Pay particular attention to disclosures subject to strict regulatory scrutiny, such as environmental claims, product labelling and consumer facing communications. Develop proof of concept frameworks to test data collection, controls and analytics in these areas.

The PwC approach: walking the talk with regulatory confidence

At PwC, we have supported many organisations in building regulatory resilience in their ESG strategy and governance. Our approach is grounded in deep regulatory knowledge, practical experience and a commitment to helping clients deliver on their sustainability promises. We work with companies to:

Define and map ESG regulatory data requirements and sources in line with global and local regulations
Design and implement robust, compliant processes and controls to meet reporting and due diligence standards
Integrate ESG and regulatory compliance into internal controls and audit frameworks
Leverage technology for automation, analytics and real-time regulatory reporting
Monitor regulatory developments, manage compliance risks and align with anti-greenwashing and consumer protection standards.

By partnering with PwC, companies can move beyond compliance to build trust with investors, customers, employees and society at large. Reliable, transparent and resilient ESG reporting is not just a regulatory requirement—it is a strategic imperative that underpins long-term business success.

Conclusion

The journey to robust ESG regulatory reporting is complex, especially as supervisory expectations continue to rise. Companies that ‘walk the talk’ by delivering accurate, consistent and transparent sustainability data—while meeting evolving reporting standards, anti-greenwashing rules, due diligence obligations and consumer protection requirements—will not only satisfy regulators but also build lasting trust with stakeholders, enhance their reputation and position themselves for success in a rapidly changing world. Building resilience is not a onetime exercise; it is an ongoing commitment to excellence, integrity and sustainable value creation.