Survey reveals 84% of enterprise organizations are prioritizing lease management due to lease accounting standards and emerging regulatory requirements around environmental impact reporting
WOODBRIDGE, NJ / ACCESSWIRE / October 31, 2023 / Visual Lease (VL), the #1 lease optimization software provider, today released the newest report from the Visual Lease Data Institute (VLDI), "The 2024 Office of Finance Outlook: Environmental Impact Reporting." Findings from this report uncover how the heightened global focus on environmental, social and governance (ESG) programs is affecting how the Office of Finance must evolve to leverage lease portfolios to meet regulatory requirements and achieve more strategic financial and operational outcomes.
VL reports that nearly 70% of surveyed senior finance executives say that their organizations are not fully prepared to track and measure the environmental impact of their leased and owned asset portfolios in order to comply with new and emerging requirements. In 2023 alone, various regulatory bodies have committed to introducing standardization to the environmental reporting process, including the International Sustainability Standards Board (ISSB), The Securities and Exchange Commission (SEC) and most recently, California's state government, further highlighting the importance of strong lease management.
"Considering that 40% of global carbon dioxide emissions stem from real estate-related assets, effective lease management serves as an organization's gateway to not only quantifying and disclosing its environmental impact, but also to tracking its progress against internal and external sustainability goals," said Robert Michlewicz, CEO of Visual Lease. "Without a strong level of control over your leased and owned assets, you risk inaccurate financial reporting and as a result, damaged relationships with crucial stakeholders, including consumers, investors and employees."
Investing in dedicated technology can also address concerns that 99% of surveyed senior finance executives have with maintaining control over their organization's lease portfolio, including concerns about data accuracy and completeness (48%), sustaining lease accounting compliance (44%) and compliance with ESG requirements and policies (44%).
"Despite how critical data collection and management is in the reporting process, our study found that 51% of enterprise organizations are either relying on Excel or a third party to help them manage their lease administration processes," said Michlewicz. "However, it is imperative that the Office of Finance leverages a centralized system of record with a strong controls framework to ensure complete and accurate asset data and emissions inventory."
The new VLDI report found that prioritizing ESG initiatives remains top-of-mind for most senior finance and accounting executives at companies with more than 1,000 employees, with 90% looking to enact new sustainability goals within the next 2-5 years, and 97% saying they are currently involved with ESG reporting decisions within their organization.
Additional findings on organizations' commitments to ESG program development and reporting include:
- 88% of surveyed senior finance executives say that sustainability factors are a high priority when entering into new lease agreements, such as increasing the number of LEED-certified buildings in their lease portfolios or increasing the number of energy-efficient vehicles in their fleets.
- Less than one-third of senior finance executives report that their ESG reporting framework is fully established and includes a variety of environmental factors, with 30% disclosing that their framework is limited to specific organization initiatives.
- While the majority of surveyed senior finance executives reported that they've collected key environmental data, less than 40% have analyzed or used the data to establish benchmarks.
To download the report and view the full data findings, click here.
Visual Lease conducted a national survey of 200 U.S. senior finance executives at private, public and government organizations with more than 1,000 employees.
About Visual Lease
Visual Lease is the #1 lease optimization solution provider, empowering organizations to leverage their lease portfolio for strategic financial and operational outcomes. Our powerful and secure platform serves as a centralized system of record for all lease financial, operational and legal data, and is purpose-built to support every team that interacts with a company's lease portfolio. Informed by nearly three decades of experience, our solutions help companies easily sustain compliance with FASB, IFRS, GASB and ISSB reporting requirements, and mitigate the risks and maximize the value associated with their lease records. Our award-winning software is used by 1,500+ organizations to manage more than 1 million real estate, equipment and other leased asset records globally. For more information, visit visuallease.com.
About the Visual Lease Data Institute
The Visual Lease Data Institute is a collection of market-leading data, trends and insights on lease accounting, management, sustainability reporting and optimization created and curated by Visual Lease, provider of the #1 lease optimization software. The Institute was founded on 35+ years of experience managing lease data and financials, and was created to empower organizations with the market data required to leverage their lease portfolio for strategic financial and operational outcomes.
Media Contact:
Erica Bonavitacola
Visual Lease
T+1 732 860 4838
ebonavitacola@visuallease.com
SOURCE: Visual Lease
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