CFOs are struggling to translate their corporate sustainability promises into measurable action, according to data from Deloitte Consulting. But CFOs should be leading the charge in environmental accountability, Global Reporting Index (GRI) Country Manager Hendri Yulius Wijaya said.

Traditionally, the role of the CFO doesn't extend past corporate finance and risk management. But shifts in the overall business landscape toward prioritizing sustainability have similarly altered that role.

Deloitte's report, which surveyed more than 2,000 executives in 21 countries, found that CFOs understand "sustainability is now within the finance domain, and that finance teams are in a unique position to not only translate and operationalize sustainability within their organizations – but also communicate outcomes to stakeholders."

Furthermore, CFOs are realizing the physical risks posed by climate change like extreme heat, worsening storms, and wildfires. "We now see CFOs are increasingly demanding and supporting immediate actions to limit the impact of climate change," Brian Ho, Deloitte's APAC climate and sustainability assurance leader said.

Despite this increased awareness of climate change and its physical and financial risks, the report found CFOs are still having a hard time acting on sustainability commitments. However, Wijaya noted this gap "is precisely where the opportunity lies to create long-lasting changes, led by CFOs."

The emergence of sustainable finance, sustainability-related government regulation, R&D advances, and societal pressure to act against climate change has compelled many CFOs "to 'cross the Rubicon' and look beyond revenue generation and cost reduction" as top priorities, he said.

CFOs, along with other C-suite executives, should drive the integration, measurement, and reporting of progress on sustainability commitments, Wijaya said.

Some of the most common sustainability reporting standards are "available as a free public good" from GRI, an independent organization that claims to establish a global common language for organizations to report environmental impacts and allow for "informed dialogue and decision making around those impacts."

According to Wijaya, the GRI Standards make CFOs better sustainability leaders in three big ways.

First, the standards require that companies describe the extent to which executive management has aligned corporate sustainability with long-term business strategies and policies, he explained.

The standards also require that leaders report how they connect measurable environmental, social, and governance (ESG) metrics to the performance of all business functions. This ensures that sustainability commitments are fully integrated into the business with as much importance as financial metrics.

Wijaya also said standards-required performance evaluations push execs deeper into the weeds of their sustainability commitments. These evaluations are meant to increase leaders' exposure to ESG issues and provide incentive to fully integrate sustainable practices within the company, Wijaya explained.

He recommends CFOs set an example from their position near the top of the ladder by "translating the opportunities and benefits of sustainability into financial terms, and utilizing financial and non-financial data in ESG strategy."

"CFOs have a leading role to play in unlocking the sustainability potential of the company in a way that is aligned with long-term value creation," he added.

For CFOs who are struggling to show progress or impacts from their ESG targets, tracking and reporting metrics like carbon emissions, for example, is the place to start.

"Without the ability to track and report sustainability performance and metrics, CFOs will be unable to meet demands from investors, management and other stakeholders, all of which underlines the growing relevance of robust sustainability reporting when setting financial KPIs and strategy," Wijaya said.