Key takeaways
- The 2025 State of Corporate Sustainability Disclosure Report found rising momentum in climate transparency, with a notable uptick in emissions disclosures and climate risk reporting.
- Transparency levels were tracked across 39 metrics, focusing on four key areas: greenhouse gas emissions, net zero greenhouse gas emissions targets, climate risk assessment and climate transition planning.
- While companies are setting more ambitious climate goals, few are sharing how they plan to achieve and pay for climate transition strategies and adaptation measures.
S&P 500 companies are increasing their climate-related metrics disclosures and commitments — including harder-to-quantify Scope 3 emissions — but still lack transparency on how they plan to reach their ambitious climate goals, according to an annual report released May 20.
The third annual State of Corporate Sustainability Disclosure — a project from the UCLA Anderson School of Management's Center for Impact, in partnership with the UCLA Institute of the Environment and Sustainability's Center for Corporate Environmental Performance — analyzes sustainability reports and proxy statements from S&P 500 companies related to both performance and overall transparency. The report, compiled by the Center for Impact's Open for Good initiative, shows that gaps remain in Scope 3 reporting completeness, climate governance at top management levels and financial transparency for climate transition plans.
Disclosure rates for Scope 1 — direct emissions from sources an organization owns or controls— and Scope 2 greenhouse gas emissions — indirect emissions from the purchase of electricity, heat and cooling — remain high at over 88%. Scope 3 disclosures, which encompass all other indirect emissions, including those in the value chain, have increased from 56.4 % to 69.8%. Net zero and carbon neutrality commitments are becoming increasingly common, with 57% of S&P 500 companies announcing such goals. Companies are also beginning to lay important groundwork for climate transition planning: 24.4% of firms have publicly disclosed a transition plan outlining their decarbonization pathways.
"While companies are setting more ambitious climate goals, few are sharing how they plan to get there. Credible action demands clear transition plans, governance and cost estimates," said professor Magali Delmas, lead author of the report and faculty director of the UCLA Center for Impact.
Other highlights of the report include:
- 100% of companies with transition plans report mitigation strategies, yet only 65.1% disclose adaptation measures.
- No company has disclosed full capital or operating cost estimates for its transition strategy.
- Transition planning is most advanced in utilities and materials sectors, but lags in others.
The findings come as regulatory requirements tighten under California's SB 253 and SB 261 and the EU's Corporate Sustainability Reporting Directive. The Center for Impact's report stresses that companies that improve data quality, set interim targets and strengthen governance will be better positioned for a low-carbon future.
Open for Good is an ongoing research initiative designed to encourage and disclose levels of corporate transparency among S&P 500 companies. Open for Good was launched in 2023 at a time of mounting pressure from investors, consumers and regulators on corporations to demonstrate their commitment to sustainability measures through transparency and disclosure.
Through publicly available data, Open for Good researchers have collected and analyzed S&P 500 companies' sustainability disclosures and assessed their transparency levels across 39 metrics, including greenhouse gas emissions, diversity and inclusion and CEO-to-median-worker-compensation ratio, as well as audit status of the reported data. The Open for Good platform includes an interactive dashboard that enables users to adjust the weight of different disclosure areas and review the top-disclosing companies across specific business sectors. The center's fall 2024 report, the Transparency Index, highlighted companies that are leading the way in their climate disclosures.
"By fully disclosing their sustainability performance, companies can demonstrate their leadership, build trust with stakeholders and drive long-term value creation," said Delmas, who is a member of the faculty at both UCLA Anderson and the UCLA Institute of the Environment and Sustainability. "The Open for Good Initiative emphasizes the importance of high-quality, credible disclosure, empowering companies to make a meaningful shift toward greater transparency and accountability."
