Financial executives can play a vital role in advancing climate actions and accelerating the world towards a low-carbon economy. Focusing on corporate-level actions and highlighting the economic opportunities that arise from higher carbon pricing are critical to effectively connecting finance with sustainability.

Safeguarding capital, building value, and contributing to a positive change for the company are essential components of the CFO’s responsibility. The country’s financial leadership must remain forward-looking. CFOs must ensure that financial reporting and reporting frameworks provide concise, accurate and authoritative information that allows businesses to drive transformational change.

By being transparent on what they’re doing and why CFOs have the opportunity to build important relationships with other key stakeholders in their organizations and maintain credibility. Eighty-eight percent of those responding say they understand that relying on ESG metrics alone to evaluate performance is inadequate, which suggests that the topic is becoming accepted in the finance function.

CFOs are on the path to finding new meaning and value in their role and the more critical they are in the evolution of the company, the more they will be valued for the unique vantage point and skill set of the CFO. CFOs are likely to spend an increasing amount of time on issues of materiality, transparency, and a willingness to align resources with their priorities. In terms of these four issues, there are a number of key trends driving new initiatives and recommendations. The global context has become more complex and demands a different set of parameters and due diligence. These trends include:

  • The exponential growth of the renewable energy sector. The amount of capital financing and technical expertise in this space is expected to grow exponentially.
  • The growing adoption of sustainability reporting and disclosure.
  • Increased demand for disclosure of data around indicators of success.

As a result, sustainability reporting and sustainability functions may see rapid adoption and significant growth. According to the World Bank, 74 percent of companies in the G20 now report sustainability metrics, up from 18 percent in 2012. See more insights from Gary McGaghey here: https://gary-mcgaghey.medium.com/