Environmental, Social, and Governance (ESG) has moved far beyond annual reports and sustainability statements. For South African executives, ESG is now tied to regulatory pressure, investor expectations, risk management, and long-term business resilience.
Yet despite the growing importance of ESG, many organisations have not committed and started managing it, or are still trying to manage it with disconnected systems, manual processes, inadequate governance structures, and once-a-year reporting cycles and are not getting value out of their efforts. The result is uncertainty, inefficiency, and a growing sense that ESG is harder to control than it should be.
Here are five ESG challenges that continue to keep executives awake at night:
ESG data lives everywhere, and nowhere
One of the biggest frustrations for leadership teams is the lack of a single, reliable and continual source of ESG information which talks to the nature of the business. Environmental metrics sit in operational systems, HR holds social data, finance tracks some governance indicators, and sustainability teams often compile reports using spreadsheets and presentations. When reporting time arrives, pulling everything together becomes a manual, time-consuming and inefficient exercise, with uncertainty that the final numbers reflect reality or that any risks are being exposed.
Without integrated performance data, ESG remains reactive instead of manageable.
Where to start, what delivers value, and what is material?
Companies are often unclear about which ESG factors truly matter, what risks they pose, and what the return on effort looks like. The starting point is to define a clear process to determine purpose, assess materiality, and develop a practical, manageable roadmap aligned to both organisational priorities and stakeholder expectations. This includes building awareness, strengthening internal capability, managing change effectively, and identifying and quantifying key risks. ESG does not need to be a reactive or overwhelming exercise — it should be a structured approach that gives management and stakeholders confidence that risks are understood, processes are embedded, and long-term resilience is being built.
ESG is still treated as a separate process
In many organisations, ESG reporting runs alongside finance, risk, and strategy instead of being part of them. Budgets are planned without ESG targets and performance is reviewed without ESG metrics. Strategy discussions happen without reliable sustainability data. This separation makes ESG harder to manage and almost impossible to link to real business performance.
Companies that are making progress are the ones starting to treat ESG the same way they treat financial performance or risk management; as something that must be tracked, measured, and managed continuously.
Lack of visibility makes decision-making harder
Executives are expected to make decisions about energy use, transformation targets, supply chains, governance practices, and long-term investments, often without clear, up-to-date ESG information and visual analysis.
When data is fragmented and scenario modelling is not possible, leaders can’t see the full picture, and when they can’t see the full picture, decisions become slower, more cautious, and bring more risk.
Better visibility doesn’t come from more reports. It comes from having ESG information built into the same performance framework used to run the business.
Reporting pressure keeps increasing
South African organisations face growing pressure from regulators, investors, customers, and boards to provide accurate, auditable and relevant ESG information. Requirements linked to integrated reporting, King V, JSE expectations, and global frameworks are becoming more detailed every year. The challenge is not just producing a report, but producing one efficiently and that stands up to scrutiny.
Executives know that when ESG reporting relies on manual consolidation and last-minute validation, the risk of errors, inconsistencies, and reputational damage rises significantly with resources stretched to deliver. In addition, many organisations admit privately that ESG reporting consumes enormous time and resources but delivers limited strategic value. Teams spend weeks compiling data, validating numbers, and preparing disclosures, only for the information to be reviewed once and then filed away until the next cycle.
This is why more companies are starting to rethink how ESG is managed, not as a standalone exercise, but as part of broader performance management, where financial, operational, and sustainability metrics sit in the same environment and are reviewed together.
The shift executives are starting to make
The organisations that are gaining control over ESG are not necessarily collecting more data. They are managing it differently. By integrating ESG into the same performance, planning, and reporting processes used for the rest of the business, they move from reactive disclosure to proactive management.
In a world where expectations keep rising, that shift may be the difference between ESG being a compliance burden, or a genuine strategic advantage.
