Fast approaching climate-related risk and reporting requirements impact the middle market

Middle market organizations may unknowingly face profitability and compliance issues with looming climate-related risk and reporting requirements. In the media, climate-related reporting and other looming regulations look to only impact public entities, but that’s not the case. There are related downstream effects and stakeholder pressures on private entities to evaluate risks, report on climate data and respond to ESG questionnaires. Action is needed and it goes beyond compliance and reporting. Private organizations can leverage ESG and sustainability for data and reporting readiness and to protect and enhance value.

Baker Tilly ESG specialists discuss the impact of proposed climate-related disclosures and what the middle market is doing today. Read the Q&A below to understand what this actually means for your organization and what you can do to prepare.

Q&A

1. What do we hear from clients? How are they preparing and responding to ESG risks?

Clients are facing pressures from both internal and external stakeholders to track, manage and report ESG and sustainability goals and progress. As a result, we work with clients to help them understand the risk areas specific to their organization and their market. Most of the time, incorporating climate-related risk mitigation into their existing risk management processes is the first step. After taking those first steps, our clients see the opportunity beyond compliance and risk management. Building a sustainability strategy yields value and revenue creation. Learn more about aligning ESG risks with your existing ERM program.

2. What percentage of our middle market client base is under the initial or developmental stage?

Most organizations are just getting started. We see about 60-70% of our clients are in the initial or developmental stage of their ESG growth journey. Learn more about