Environmental, Social and Governance (ESG) reporting is increasingly essential as regulatory expectations grow and stakeholder scrutiny intensifies. For businesses with physical assets such as buildings, the key challenge is not whether to report on ESG, but how to do so effectively and accurately. This article explores the specific ESG reporting challenges and ESG data challenges faced by building operators and estate managers, and outlines practical ways to overcome them.
How can Cube Controls help? If your organisation is facing increased scrutiny around ESG reporting and struggling to unify building data across systems, Cube Controls offers practical, proven support. Our expertise in integrated building controls and compliance reporting ensures your strategy is both data-driven and audit-ready. Visit https://www.cubecontrols.co.uk/services/business-energy-assessment/ to find out more.
What is ESG reporting?
ESG reporting refers to the disclosure of data concerning a company’s environmental impact, social responsibility and governance practices. These disclosures complement financial reports by providing a broader view of risk, resilience and ethical performance. For businesses managing buildings or estates, this often includes tracking energy consumption, indoor environmental quality and emissions. While many already monitor this through Building Management Systems (BMS), pulling it together in a compliant, credible format is a distinct challenge.
For more detailed background information on ESG reporting, refer to our previous blog on ‘Understanding ESG Reporting’.
ESG Reporting Challenges
Whether you’re managing a single property or a multi-site portfolio, ESG reporting introduces a range of complex obstacles. These challenges often stem from the variety of reporting standards, evolving compliance rules and internal misalignment between sustainability and financial reporting teams.
Fragmented frameworks
Businesses often face multiple ESG disclosure frameworks. In the UK, TCFD-aligned disclosures are now mandatory for many companies. However, firms with a broader operational footprint may also be expected to consider Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB) or even Sustainable Finance Disclosure Regulation (SFDR). These all differ in scope and terminology, which can cause confusion. At the time of writing, a global review of ESG frameworks is being considered to improve consistency, driven in part by the creation of the International Sustainability Standards Board (ISSB) by the IFRS Foundation. The ISSB was formed following COP26 in Glasgow, UK, the UN global summit focused on addressing climate change. It aims to consolidate various existing standards, including SASB, into a single, globally consistent baseline for sustainability reporting. However, no single universal standard exists yet. Learn more from IFRS.
Regulatory complexity
ESG reporting requirements are evolving rapidly. The introduction of the UK-specific initiative Sustainability Disclosure Requirements (SDR), as an extension to the TCFD, builds on existing obligations, requiring more detailed, forward-looking and standardised disclosures. This trend towards more granular data requirements puts pressure on reporting teams to stay informed and agile, particularly in property-focused sectors where emissions, efficiency and air quality data must be accurately reported.
Risk of ‘greenwashing’
Without unified measurement standards, companies risk being accused of ‘greenwashing’. For example, highlighting a net-zero pledge without outlining the governance, investments or verification processes behind it. A lack of standard audit procedures means third-party ESG assurance is inconsistent, which can undermine stakeholder confidence.
Governance gaps
The importance of governance in ESG is often underestimated. In many cases, the issue lies not with external standards, but with the internal governance structures of companies themselves. ESG efforts often lack clearly defined ownership, executive accountability or integration with core business strategy. As a result, many reports focus heavily on environmental and social metrics, with less emphasis on how ESG priorities are actually set and monitored. Strong governance involves defining decision-making processes, disclosing oversight structures and showing how actions align with long-term values and objectives, particularly when applied to estate-wide improvement planning.
ESG Data Challenges
While reporting frameworks set the structure for disclosure, the real difficulty often lies in collecting the right data in a consistent and reliable way. For building-based businesses in particular, data is often fragmented across systems and teams, making meaningful ESG reporting a technical and organisational challenge in itself.
Data silos across the business
One of the most persistent ESG data challenges is siloed information. Facilities teams may collect energy and water data via BMS platforms, while HR manages diversity metrics and finance oversees compliance documentation. This fragmentation makes it difficult to align ESG disclosures with financial reporting or capital investment decisions.
Broad and inconsistent metrics
ESG is an expansive domain. It covers everything from carbon output and lighting systems to employee safety and executive compensation. These metrics vary in measurability, frequency and relevance. One of the underlying issues is that even fundamental concepts such as ‘risk’ are not universally defined. For instance, some frameworks interpret risk in financial terms, while others focus on reputational, environmental or operational exposure. Without this alignment, buildings may report energy use or climate exposure differently, making comparisons difficult and increasing the risk of ESG data issues.
Reliability of ESG data providers and scoring
There are numerous ESG data providers globally, collecting and structuring ESG-related information from a wide variety of sources, such as emissions data, board composition or diversity metrics. This data is then packaged for use by investors, analysts and companies.
Some providers also function as ESG rating agencies. These entities take ESG data and apply their own scoring methodologies to assess a company’s ESG performance or risk. However, because methodologies vary widely and are often proprietary, different agencies can assign different scores to the same company. This inconsistency makes it difficult for organisations to benchmark performance or respond effectively to investor concerns. For more information, the Harvard Business Review explores why ESG ratings vary so widely.
Inconsistent data entry
Many businesses still rely on spreadsheets and emails to collect ESG data, even for buildings equipped with BMS. This manual approach increases the risk of errors and delays in reporting. Integrating data sources remains a key obstacle in resolving the challenges of ESG data.
Practical Solutions to ESG Challenges
Addressing the challenges of ESG reporting and data collection requires more than just awareness, it calls for action. The following strategies can help organisations overcome operational and regulatory hurdles while making better use of their building data.
- Monitor regulatory changes: Assign responsibility to a team or individual for keeping track of ESG reporting developments. This ensures your organisation is always prepared for changes in regulation or best practice.
- Implement advanced software: Purpose-built platforms can consolidate building performance data, reduce manual work and help apply consistent data collection. Systems integrated with BMS technology can improve both accuracy and reporting efficiency.
- Strengthen governance: Ensure ESG governance is formalised. That includes outlining who makes decisions, how progress is monitored and what escalation processes are in place. Disclosures should explain not only what has been done but why, particularly for energy-saving upgrades or maintenance investments.
- Validate data: Where possible, involve independent third parties to verify ESG data. While no global audit standard exists yet, credible assurance enhances trust. Internally, use consistent formats and routines to ensure data quality.
- Prioritise ongoing monitoring: ESG KPIs should not be treated as annual checkboxes. Real-time tracking of building data through BMS systems allows for more responsive risk management, greater transparency and stronger alignment with performance goals.
- Commission a business energy assessment: An expert-led energy audit can uncover hidden inefficiencies and provide data-driven recommendations aligned with ESG goals. Services like Cube Controls’ energy assessment help building operators gather reliable data to support more accurate reporting and actionable sustainability improvements.
Cube Controls’ View on ESG Data and Reporting Challenges
At Cube Controls, we regularly support customers navigating the dual pressures of compliance and performance. Our view is that ESG reporting problems are rarely due to lack of intent, as most organisations genuinely want to disclose accurate and meaningful information. The core problem is the fragmented nature of ESG data and the fast pace of regulatory change.
For many clients, the ESG data collection challenges stem from operational systems that were not designed with reporting in mind. Our work helps bridge this gap, integrating environmental and building data with central platforms to support strategic ESG goals.
“We see firsthand how many building operators are committed to doing the right thing but lack the infrastructure to deliver meaningful reports. Our role is to connect the data, the systems and the strategy so they can report with confidence.“
- Tony Williams, Director, Cube Controls
Turning ESG Challenges into Strategic Advantage
The challenges in ESG reporting and ESG data collection challenges are significant but not insurmountable. By adopting the right tools, strengthening governance and focusing on quality data from building systems, organisations can shift from reactive compliance to strategic advantage. And as standards evolve, working with experienced partners like Cube Controls will help you stay one step ahead, not just reporting ESG, but leading with it.
Cube Controls is an established and experienced supplier of Building Management Systems, specialising in the design and set up of bespoke environmental and energy control programmes for commercial buildings and property.
To find out how Cube Controls can support you at all stages of design and consultancy, installation and modification and maintenance of your building management systems contact our expert and friendly team on 01903 694279 or sales@cubecontrols.co.uk.
