Mandi McReynolds is the Chief Sustainability Officer at Workiva, a reporting software company, and also serves as Vice President of its global ESG division. She has over 15 years of leadership experience in building corporate responsibility and environmental, social, and governance (ESG) departments across four different industries. Over the coming weeks, McReynolds will be on-site at the COP29 summit in Baku, Azerbaijan, providing conference recap coverage for ESG Dive.

Environmental challenges remain a core issue for global societies, governments, and businesses. The urgency of addressing climate change has never been more apparent—this year, there are over 60 elections globally, and global temperatures have repeatedly hit record highs. Additionally, 70% of industry professionals believe that companies are not acting quickly enough to achieve their ESG goals. Global stakeholders will continue to demand concrete action and measurable progress on sustainability initiatives, as they increasingly recognize the value of ESG initiatives in reshaping operations, innovating products, and creating lasting social impact. For businesses, the climate transition presents both a challenge and a transformative opportunity.

A core fact of this transition is that businesses have a responsibility to build resilience and pave the way for a more sustainable economy. We often see that inefficiencies in data collection and reporting make it nearly impossible for companies to stay on track with their climate goals. The shift toward a more climate-conscious business model goes beyond compliance and risk mitigation; it is about enhancing resilience and laying the foundation for a more sustainable future.

As more than 32,000 delegates gather this week in Baku, Azerbaijan, for COP29, and with global sustainability-related regulations and directives continuing to gain momentum, this climate conference faces a unique opportunity to set meaningful climate goals and accelerate the world's transition to clean energy. To achieve this, it is essential to consider some key trends emerging in this space:

Corporate ESG reporting faces greater scrutiny, bringing new opportunities

Since last year's COP summit, stakeholders have demanded greater transparency from companies regarding their sustainability practices. As a result, companies are under pressure to go beyond standard reporting compliance to address multiple demands and gain a competitive edge.

However, we find that leading companies are able to grow their businesses sustainably, meeting global expectations while also preparing for regulations such as the EU's Corporate Sustainability Reporting Directive (CSRD). In fact, according to our research, 91% of executives agree that integrated financial and ESG reporting provides a holistic view of performance, and 81% of companies not subject to CSRD still say they plan to comply with the directive. Many companies recognize this as a transformative opportunity to operate successfully in the future economy and create a positive impact on society.

Alignment with global and local ESG standards

Although the global regulatory landscape continues to evolve, with CSRD remaining the gold standard on the international stage, U.S. companies will have to navigate regional and even state-level differences in the coming years. There is a growing push across countries and regions for unified sustainability standards, aimed at improving comparability and accountability on a global scale. During this critical period of regulatory change, COP29 will undoubtedly shape the ESG and sustainability reporting landscape, with far-reaching implications for businesses worldwide. Developing consistent, accurate, and scalable standards that incorporate double materiality and transparency principles is essential for stakeholders who need to assess and compare performance across regions. Furthermore, standardized approaches help reduce confusion and improve the overall usefulness of disclosures, and companies that adopt proactive reporting strategies will thrive.

Commitment to prioritizing transparency and data-driven decision-making

Despite recent target rollbacks across industries, pressure from regulators and other companies to achieve climate goals continues to grow. More than 4,200 companies and 23,000 organizations globally have set science-based targets (SBTi), representing half of the global market capitalization, and report emissions data through initiatives such as the Carbon Disclosure Project (CDP). Companies committed to transparency are increasingly turning to data analytics to guide their actions. A comprehensive, data-driven approach across business functions enables companies to set precise targets, measure progress more accurately, and dynamically adjust strategies in real time. Focusing on data enhances both the effectiveness of a company's sustainability efforts and provides a stronger foundation for stakeholder communication.

Climate action as a competitive advantage

The ability to accurately measure and report the costs, risks, and benefits associated with the climate transition is becoming a key differentiator for companies. It is no longer enough for companies to set vague sustainability goals or engage in superficial initiatives. Workiva's recent ESG practitioner survey shows that 88% of finance and sustainability professionals agree that strong ESG reporting provides their organization with a competitive advantage. Today's business leaders are expected to understand, measure, and effectively communicate their climate-related impacts to remain competitive in the market.

COP29's impact on future corporate performance

COP29, dubbed the 'Finance COP,' will be a pivotal moment for the global climate transition, expected to further shape the ESG landscape and drive companies toward sustainability goals in preparation for COP30. Companies must examine the outcomes of the conference and understand their implications for their own organizations. At the same time, they should be prepared to face accountability from regulators, consumers, and stakeholders, as 2025 will be a critical juncture—just five years away from 2030 corporate commitments and deadlines. This is a crucial moment for global companies to recognize their role in the new sustainable economy.