The Race to Bring Financial Reporting, ESG, and GRC Together

No matter how you feel about ESG, an organization’s environmental risks and impacts, attention to social responsibility, and governance are bound to affect CFO teams. But why should accounting and finance professionals pay attention to ESG sooner rather than later?

Our team of finance, risk, and ESG industry principals dug into the details in a recent webinar, “The Flywheel Effect of Unified ESG, Audit & Risk, and Financial Reporting,” now available on demand. Here’s a preview.

Why is everyone talking about ESG? 

Stakeholders of all kinds have been pressing companies to publish details of ESG performance, risks, and opportunities. That has created advantages for companies that disclose that information, says Mark Mellen, ESG Industry Principal at Workiva.

So how does ESG affect financial reporting teams?

Many stakeholders are evaluating a company’s long-term health by reviewing not only financial performance but also ESG factors. The U.S. Securities and Exchange Commission (SEC), the European Union’s Corporate Sustainability Reporting Directive (CSRD), and others are pushing for annual reports to include both financial and ESG data with some level of assurance. 

This demand for assured integrated reporting of financial and non-financial data is creating a need for tech-enabled, cross-functional teams to efficiently share data—and for tech-enabled auditors to quickly verify that data in your reports can be trusted. 

Former auditor Josh Gertsch, Senior Industry Principal at Workiva, noted direct and indirect ESG impacts on financial performance, including accounting for compensation of staff or potential impairments. Watch the full webinar for more.

But why are accounting and finance teams getting involved with ESG reporting?

ESG risks and opportunities are simply business risks and opportunities, which means teams across your company should be involved in assessing, managing, and reporting on them. There’s a special role for accounting and finance teams to play in the ESG reporting process, as Josh explains.

How should ESG and GRC teams work together?

As a former senior internal audit manager, Workiva Solution Engineer Neepa Pandya has helped companies build assurance around ESG. Here, she shares what worked for one company that successfully connected ESG and GRC (governance, risk, and compliance) colleagues to create trusted reports.

Get more recommendations from Neepa in the full webinar.

She notes many of your ESG colleagues may not have had to undergo an audit, implement controls, or test controls before. “This will be a cultural shock as these assurance mandates come down the line here,” she said.

The bottom line

Technology can help financial reporting, ESG, and GRC teams work together more efficiently to produce assured integrated reports on the timelines that stakeholders are demanding. Rather than choosing software that addresses only financial reporting, ESG, or GRC, your procurement team may find it helpful to select a platform all three teams can use. Request a demo with the Workiva team to see the one platform that unites financial reporting, ESG, and GRC.