In a recent analysis by Deloitte, nearly half of the FTSE 100 companies (46%) made restatements to their previously reported climate and sustainability metrics this year. This trend highlights the growing complexity and scrutiny of ESG (Environmental, Social, and Governance) reporting, particularly as new EU regulations loom on the horizon. 

Deloitte’s report revealed that 89% of these restatements pertained to greenhouse gas (GHG) metrics, with Scope 3 emissions—indirect emissions from activities like business travel and waste disposal—accounting for 32% of all adjustments. The primary reasons for these restatements were changes in methodology (44%) and the correction of errors (29%), indicating the evolving nature of sustainability measurement practices. 

As the Corporate Sustainability Reporting Directive (CSRD) comes into effect, UK companies with EU operations will be required to disclose a broader range of ESG metrics starting from financial years beginning on or after January 1, 2024. This new regulatory framework is expected to increase the frequency and scope of ESG metric restatements, as companies strive to meet heightened expectations for accuracy and transparency. 

Steve Farrell, partner and head of sustainability assurance at Deloitte, emphasized the importance of trust in these non-financial metrics, stating, “Companies must increasingly report metrics beyond their financial information, and crucially, those figures must be trusted by investors, employees, and other users of this information.” 

Sources: 

https://news.bloomberglaw.com/esg/emissions-reporting-leads-big-uk-companies-esg-data-revisions 

https://www.deloitte.com/uk/en/about/press-room/nearly-half-of-the-uks-largest-companies-made-restatements-on-climate-and-sustainability-as-new-reporting-rules-loom.html 

https://specificationonline.co.uk/articles/2024-09-03/nearly-half-of-the-uk-s-largest-companies-made-restatements-on-climate-and-sustainability