Alexforbes announces key outcomes from the sustainability reporting market sentiment survey

Johannesburg, 24 July 2025 – Alexforbes has announced the key outcomes of the recently conducted Sustainability Reporting Market Sentiment Survey. This survey, led by Alexforbes in collaboration with the Companies and Intellectual Property Commission (CIPC) ‒ an agency of the Department of Trade, Industry and Competition (the dtic) ‒ sought to assess market sentiment, understanding, adoption, readiness and implementation costs related to sustainability reporting in South Africa.

Alexforbes launched the Headline Results Report on 22 July 2025 at an event co-hosted with the Institute of Directors South Africa. Representatives from the CIPC and the Financial Sector Conduct Authority (FSCA) were in attendance, with Mr Cuma Zwane of the CIPC presenting an overview of the regulatory development journey.

Shortly after the report launch, the FSCA and International Finance Corporation (IFC) ‒ a member of the World Bank Group ‒ issued a joint press release on 23 July 2025 announcing a Cooperation Agreement to support the development of climate and sustainability reporting regulations aligned with the International Sustainability Standards Board (ISSB). Their announcement reinforces the timeliness and relevance of the survey outcomes in supporting informed policy decision-making.

Survey participants included a broad cross-section of market participants, with listed companies making up 46.8% of the sample ‒ many of them large-cap firms with a market capitalisation above R30 billion.

The survey found that 68.8% of respondents currently report on some aspect of sustainability, despite only 38.7% being required to do so ‒ indicating a strong level of voluntary disclosure. Key motivators for reporting include domestic regulatory requirements (29.4%), followed closely by investor and financial stakeholder expectations (28.7%). Other drivers include parent company obligations and international regulatory pressures.

Given the global recognition of the King reports and the requirement for listed companies to report in line with them, it is no surprise that King IV™ emerged as the most widely used framework. This was followed closely by the King IV™-endorsed Integrated Reporting Framework, the United Nations Sustainable Development Goals, and the Global Reporting Initiative. A smaller group of respondents reported using the ISSB standards – 17.9% for IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and 16% for IFRS S2 (Climate-related Disclosures).

There was strong support for sustainability reporting in general:

Notably, 70.5% of participants supported some form of mandatory sustainability reporting, which may seem surprising in an increasingly regulated environment. However, this likely reflects the recognised need for standardisation to improve clarity and comparability. Respondents emphasised that any move towards mandatory reporting should be phased, proportional, and tailored to the South African context. There was a clear expectation that such reporting should begin with publicly accountable entities or those of systemic importance, including large retirement funds and large unlisted companies.

Despite the appetite for standardisation, only 28.4% of respondents considered themselves ready to comply with potential mandatory disclosures. This highlights the critical need for collective interventions to enhance readiness. There was broad agreement that government and regulators should play an enabling role, focusing on practical support, capacity-building and clear guidance. Most participants (56.1%) identified the provision of guidance and support as the most important function for government and regulators, followed by support for training and skills development (51.4%).

Other key challenges cited by respondents included:

Advocate Rory Voller, Commissioner at CIPC, said, ‘This report offers important insights for policymakers, regulators, reporting entities and stakeholders seeking to understand and support the evolution of sustainability reporting. We invite all readers to consider these findings as part of a wider national conversation about how South Africa can strengthen transparency, protect investor interests and align reporting practices with sustainable development priorities.

Carina Wessels, Alexforbes Chief GRC Officer and Executive: Impact Advisory, commented, ‘We are exceptionally pleased that the insights gathered through this survey have helped inform the Regulatory Impact Assessment commissioned by the dtic, in considering whether and how mandatory sustainability reporting should be introduced in South Africa. We also believe the insights will support the FSCA and IFC in executing their Cooperation Agreement and assist other regulators in shaping policy decisions. Alexforbes Impact Advisory remains committed to contributing meaningfully to this important dialogue.’

Lee Swan, Alexforbes Head of Sustainability, added, ‘Our launch event was a great success and well received. We plan to issue additional supplementary reports to deepen the insights and impact. We look forward to continuing our engagement with stakeholders through webinars and bespoke events.’

The 2025 Headline Results Report of the National Sustainability Reporting Sentiment Survey for South Africa is available on the Alexforbes website. Additional supplementary reports will be released soon. To arrange a bespoke session on the findings or request further information, please contact Alexforbes.

Alexforbes will host a follow-up webinar on the report on 24 July from 15:30 to 17:00. Register here.