ESG propelled to the top priority for CFOs in 2024

11 March 2024 Consultancy-me.com 2 min. read
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Finance leaders at companies around the world rank ESG as their top priority in 2024, up from ‘only’ 14th position at the same time last year. That is according to an annual survey of CFOs carried out by Protiviti.

ESG initiatives should no longer be perceived solely as detrimental to profits and burdensome to business models. While some years ago business leaders were more hesitant to make revenue sacrifices for what looked like just charitable action, now it more or less is an accepted fact that ESG initiatives present opportunities.

Tasked with overseeing the financials and strategic investments of an organization, the CFO plays a key role in supporting and financing the ESG agenda.

ESG propelled to the top priority for CFOs in 2024

Source: Protiviti

A total of 57% of finance leaders in publicly held organisations reported that measuring and reporting on ESG risks has become part of their teams’ role within the past year. Interestingly, that percentage was lower for privately held organisations, with a majority (58%) saying that their teams did not take up this role.

“While the term ‘ESG’ has become a hot button issue for some, stakeholder demands and regulatory reporting requirements aren’t going away, leading CFOs and finance leaders to adapt as the ESG reporting landscape continues to evolve quickly, with priorities differing vastly across industries and geographies,” said Christopher Wright, a global leader at Protiviti.

“Along with the need for finance leaders to meet ESG-related reporting demands globally, our survey also finds the underlying issues that ESG commitments strive to address continue to command the attention of finance leaders and organisations over the next 12 months and beyond.”

ESG propelled to the top priority for CFOs in 2024

Source: Protiviti

Ensuring data is up to the standards for ESG reporting is one of those challenges. “Leading CFOs help CIOs reduce the organisation's technical debt, inject rigour and control into ESG and other critical data subjected to new reporting requirements and demands,” said Wright.

Besides ESG, the Protiviti study highlighted other topics such as artificial intelligence, inflation, and talent acquisition as other priorities high on the agenda of CFOs.

With the role of CFOs broadening in recent years in the face of on-going and growing threats of geopolitical turmoil, trade wars, and other new developments like AI and cybersecurity, the report suggests CFOs are now more than ever ‘strategic partners to the business’, in a move away from their traditional role of ‘supporting the financial operation’.

Wright: “Thriving in this diverse role requires the CFO to optimise automation, talent management, and financial planning and analysis within the finance organisation. And transition to becoming a strategic partner to the business.”