ESG Assurance Gains Ground Despite Regulatory Headwinds, KPMG Survey Finds

Key Takeaways

• Momentum holds despite delays: 74% of companies surveyed are continuing with CSRD reporting plans; 41% are moving forward with assurance as well.
• Maturity gap persists: Leaders score more than double Beginners in ESG assurance readiness, with little sign of convergence.
• Size and geography matter: Larger companies and those in North America and Europe are furthest along; smaller firms and those in Latin America and the Middle East lag.
• Data and complexity top the list of challenges: Complexity of standards, inadequate data access, and supplier performance are key hurdles.
• Third-party assurance is becoming the norm: 65% of companies now obtain assurance over some ESG disclosures, up sharply from last year.

Deep Dive

Even in the face of shifting regulations, mounting data demands, and a murky compliance landscape, companies aren’t backing down from their ESG reporting commitments. That’s the central message from KPMG’s 2025 ESG Assurance Maturity Index, which paints a nuanced picture of steady, if uneven, progress, and a growing divide between those leading the charge and those still trying to find their footing.

The global survey captured insights from 1,320 senior executives and board members with ESG reporting and assurance responsibilities, representing companies with an average annual revenue of $16.8 billion. Of those, 314 identified as “Wave 1” reporters, companies already preparing disclosures under the EU’s Corporate Sustainability Reporting Directive (CSRD) for financial years starting January 1, 2024.

Despite the regulatory fog, most aren’t changing course. In fact, 74% of companies say their CSRD reporting plans remain intact, and nearly half are moving forward with third-party assurance, regardless of delays and proposed simplifications under the EU’s “Omnibus” legislative package.

Progress, But Not Without Friction

The average ESG assurance maturity score slipped slightly from 47.7 in 2024 to 46.9 in 2025. That may not sound like much, but it reflects the growing complexity of the task. Even as capabilities improve, the goalposts keep moving (particularly for those already reporting under CSRD).

KPMG groups companies into three tiers: Leaders, Advancers, and Beginners. The divide between them hasn’t narrowed:

• Leaders (top 25%) scored an average of 65.2
• Advancers (middle 50%) came in at 45.7
• Beginners (bottom 25%) lagged at 30.5

The leaders (often larger companies with more resources and board engagement) are pushing ahead with advanced technologies, robust governance, and greater integration across the enterprise. Their progress stands in sharp contrast to smaller firms and those in early stages, who are still wrestling with foundational tasks like data management and internal coordination.

Where You Are (and How Big You Are) Matters

Size and geography play a defining role in ESG assurance maturity. Companies with revenues over $10 billion averaged a score of 52.8, while those under $1 billion averaged just 40.4.

Regionally, North America edged out Europe by a hair (49.0 vs. 48.9), though European firms made up significant ground thanks to the CSRD. Companies in Latin America and the Middle East continue to trail, with average scores below 43.

There’s also been a shake-up by industry. Energy and natural resources now lead the pack, while life sciences, healthcare, and infrastructure sectors remain slower to mature. One of the more encouraging signals in the report though is increased board engagement. Among Leaders, boards are actively identifying ESG risks, reviewing performance, and guiding strategy, not just signing off on reports. But translating that into real operational change is proving tougher.

Few companies have fully cascaded ESG targets into business functions, and fewer still are tying those targets to incentives. Even among the largest firms, just 57% say their ESG goals are operationalized and actively monitored.

Carlos Fernández, ESG Assurance Leader at KPMG in Mexico, put it plainly, “ESG goals need to drive real strategic change—not just become another reporting framework.”

Still More Questions Than Answers on CSRD

The EU’s CSRD remains a major driver, but it’s also a major source of confusion. Proposed changes under the EU’s Omnibus package would narrow the scope of reporting requirements and delay implementation for smaller companies. Yet, 74% of firms surveyed say they’re sticking with their original plans. Among those, 41% are also continuing preparations for third-party assurance.

The biggest challenges cited by companies preparing their first CSRD sustainability statements?

• Complexity of the standards (25%)
• Data collection difficulties (20%)
• Double Materiality Assessment (17%)

Collecting data from across sprawling global operations, and particularly from suppliers, continues to be a major pain point. Many companies are being asked to disclose new metrics they’ve never tracked before, such as biodiversity risks, gender pay gaps, and payment terms across the value chain.

The Assurance Equation

As companies wrestle with data and compliance hurdles, third-party assurance is quickly becoming standard practice. Sixty-five percent of respondents now obtain either limited or reasonable assurance over some of their ESG disclosures, which is up from 50% last year. And of those, nearly 80% use an audit firm to provide that assurance.

Despite shifting timelines, the demand for independent validation is growing, whether from investors, regulators, or stakeholders more broadly.

Michael Shannon, Global Head of ESG Assurance at KPMG International, summed it up, “Assurance is central to building trust in sustainability efforts. It enhances transparency and credibility in the market.”

For companies still early in the journey, the advice is to start now. Strengthen your governance, invest in talent and systems, and focus on quality data and board engagement. Most importantly though, don’t treat assurance as a box-checking exercise, treat it as a chance to lead.

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