In this episode of Sustainable Intelligence, Neil McCall, Senior ESG Analyst at Novata, discusses the key findings from Novata’s 2025 State of Sustainability Report. Neil breaks down why emissions, data quality, and regulatory readiness remain top priorities, and why demonstrating ROI has become the central challenge for sustainability teams.
We explore how organizations across North America, Europe, and Asia Pacific are responding to different reporting requirements, why spreadsheets still dominate despite wider adoption of ESG tools, and what separates data-mature teams from those still catching up. Neil also highlights the growing demand for skills in climate risk and supply chain due diligence, and the practical steps companies can take to strengthen their sustainability strategy heading into 2026.
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Conversation with Neil McCall (Transcript)
Ella Williamson: Welcome to Sustainable Intelligence, where we discuss all things sustainability for the private markets. I’m your host Ella Williamson, and today we’re joined by Neil McCall from Novata’s Advisory team. Neil spent five years deep in the world of sustainability, from climate risk analysis at a global consultancy to the ESG team of a major asset manager. Neil has a background in economics and environmental economics, which means he brings both a technical lens and real-world context to every project he works on. And that’s exactly why he was the perfect candidate to do the analysis behind this year’s 2025 State of Sustainability Report.
Today we’re going to get a sneak peek into how organizations are positioning their work and why emissions and data quality remain front and center. We’ll explore the pressures sustainability teams are feeling, how to improve ROI and the key skills that are rising to the top as we look ahead to 2026. So Neil, great to have you here. After spending so much time doing the data crunching for this report, how would you sum up the state of sustainability right now?
Neil McCall: Hello, Ella, yeah. What a question. I think I came up with a bit of an analogy to address this one. I’m not a hundred percent sold on it, but let’s go. I feel like sustainability space 10 years ago, it was a bit like the sixties, Paris agreement. Everything was groovy. We were gonna hit 1.5 degrees and solve the climate crisis.
The seventies was brought about with COVID. Big market shock and times are tough. Now I feel like we’ve landed in the Reagan/Thatcher eighties. It’s all about market forces. If sustainability can’t demonstrate its value, then it won’t receive any support. I think a stat we’ll come back to, but almost half said that one of the biggest concerns was demonstrating the return on investment, which I think evidences that. I guess not to say that we don’t need government action. I think we absolutely do to combat climate change. But where we are now, everything feels more market led and we definitely got a sense of that in the State of Sustainability survey.
Ella: Brilliant. I don’t think I’ve ever heard anyone refer to sustainability as groovy, so thank you for that. And I completely agree that we should bring that back. And based on how people refer to sustainability, ESG, both terms, in the survey we found that they were very widely used still. What would you say that tells us about how organizations are positioning their work when potentially people may think that ESG is dead, which has been going around in the press recently?
Neil: Yeah, definitely. This is a hot topic. For me to be honest. It distracts from what really matters. And that’s the detail beneath both of these umbrella terms that you’d like to use. I think what we really want to get to is, does your sustainability, ESG, CSR report, does it talk about five trees that you planted or does it describe in detail the risks and opportunities that you’re facing from climate change? And your strategy to mitigate those risks or explore the opportunities? I think I was quite surprised, just like you given a lot of the noise around this, that 54% of North American respondents still use the term ESG. So I guess, yeah, as you say, maybe don’t believe everything you read in the papers.
Ella: Absolutely, a fascinating stat and I think definitely something that everyone needs to consider going forward. Calling it an umbrella term, and it’s actually getting underneath that, what does it mean for your business is going to be key. And the top three priorities that emerged, no surprise. Number one emissions, data quality, and then regulatory readiness. Do you think there’s anything that links those things together and what would you say that they reveal about where companies really are in their sustainability journey in terms of maturity?
Neil: Yeah, definitely. I think you’re right to draw on the linkage between them and this question was actually a multi-select, so it certainly was the case that some respondents did choose all three of those. I think each of them came in at just below 40%. So a pretty sizable share.
First off, emissions is rightly one of the most important and broadly collected pieces of data. I think its relevance and consistency across industries and regions make it a gold standard metric. And obviously here at Novata we love a good metric. I think for that reason, I think its universal nature and consistency is also a key aspect of a lot of reporting requirements around the world such as those based on the ISSB standards, the California regs, and the CSRD. So I think as with anything that’s publicly disclosed, organizations need to ensure and they want to ensure that what they’re disclosing is accurate because it will be scrutinized by investors and getting it right is important. And again, that feeds into the data quality point that you raised. So I think between the three of them, we can definitely see a lot of overlap. In terms of what it says about where they are in their journey, we’re maybe less able to comment on that from the findings of the survey specifically. We weren’t too sure on the emission scopes, whether they’re aligned with the GHG protocol, for example, or the extent of scope three coverage, but I would say, is the fact that it’s high on the agenda indicates progression.
Ella: Progress is absolutely key. It’s not about doing everything at once. It’s about tackling what is possible for your business now and then improving that process over time. Throughout the survey being fielded, we had over 250 sustainability leaders take it from countries all over the world, and therefore we did see some really interesting regional differences appear, especially around approaches to reporting and the different regulations that impact those countries. What would you say stood out most across North America, Europe, Asia Pacific, in terms of those regulatory and reporting demands?
Neil: Yeah, definitely. I would agree. We did have a really good sample from this survey and I was impressed with the global coverage that we did get. I would have to caveat that the question was worded, where was your organization headquartered? And obviously in the globalized world that we live in, this is not to say that these organizations don’t operate in other regions. They absolutely will. I think where an organization’s headquartered is still a really good predictor of where an organization will generate most revenue and also have a little bit of sway on the company culture. And as you mentioned, the regulations that it’s in scope for.
So it feels very much like stating the obvious. But of those headquartered in Europe, 55% are complying with or preparing for the CSRD. Now, that on its own isn’t incredibly insightful, but what I did take from that was that across all regions and regulations, this was the most concentrated response. So more European companies are reporting to the CSRD, than say, North American companies are responding to the California regs. What that does say is that despite the stalling that we’ve had with Omnibus, it does show that the CSRD has companies paying attention, and I think it’s really important that Europe continues to progress with its regulatory efforts. In the rest of the world, I’m optimistic about the adoption of the ISSB standards in various regions such as Australia, Japan, and Brazil. And I think this is definitely one to keep an eye on.
Ella: Brilliant, and I agree that 55% stat to me seemed quite high based on all of the uncertainty from the Omnibus, but it does show that companies, regardless if they are in scope or out of scope, are still trying to make progress towards those goals and standards. Now one thing that we saw, which was a surprise to us as an organization, was that many organizations still rely on spreadsheets even when they have a tool or software that they use on top of that. Why do you think that’s happening, and what does it say about data maturity across the sustainability space?
Neil: Yeah, a really interesting one. And spreadsheets are a little bit taboo, I would say. But they absolutely have their place and I think with technology platforms and tools, they don’t necessarily need to be substitutes for spreadsheets. They’re very much complimentary. So, for example, we would request that our clients populate Excel spreadsheets as inputs that we can then use in our software. We’d also pilot spreadsheets for certain pieces of data analysis before we embark on building something a bit more robust.
I would say the key area where spreadsheets certainly lack is through their ability as a single source of truth and as a place to store your data. I think that there’s issues from version control, from a lack of an audit trail that you really lack through spreadsheets on their own, and that’s why we would definitely recommend that it’s complimentary to a technology provider, an ESG tool.
Ella: Yeah, spreadsheets are almost a point in time view of your data, whereas when you have a tool, you can see how different metrics are progressing over time across both your business and across your supplier’s businesses, and those people who are requesting your data.
Another interesting stat was that almost half of respondents said that their biggest challenge is proving the value of sustainability. So basically that ROI piece that you were talking about earlier. What do you think separates teams that are starting to be able to do this and those that haven’t even got a grip on how to do that? And how do you think teams can start to prove the value of their sustainability work?
Neil: Yeah, 100%. This is a challenge undoubtedly. It’s so important, and I think the first step is making sure that you have good data quality, because to demonstrate value or trends over time, we really need to tie this to good quality and consistent data that’s comparable. So yeah, I would definitely say that the first step is tracking the metrics that matter. It is also a maturity thing, and it takes time to track this consistent data and build up sufficient data to be able to draw these conclusions and insights. You can’t do it from a standing start. I think obviously, at Novata, we have the benefit of a large database that helps us with this massively that we are able to compare across companies, regions, sectors, and we always advocate for clear definitions and consistent definitions so that we are able to do that.
I think the final point I would make on that is very closely tied to the recommendations of the TCFD and the ISSB standards. It’s so important to tie these metrics to real financial incomes. So let’s put some numbers to it: we spend say, X million dollars in energy. We could install solar panels for a cost of Y million dollars and it would reduce energy cost by Z%. So what would the payback period, and is that investment worthwhile to achieve tangible financial benefits for the organization?
Ella: Great. And building on that, every company is different and what is valuable to one company may not be valuable to another company based on the industry they’re in or based on the client base they have. So building that data over the time and actually showing the value for your business is gonna be really key to developing that ROI piece. Throughout the report, we split our data by financial companies and non-financial companies, and they seem to be on different paths. What do you think is driving that gap and where might they learn from one another?
Neil: Yeah, this was a really interesting split in the data, and we actually had quite a balance share between financial companies or financial organizations and non-financial organizations. I think financial institutions appear slightly more tech enabled and concerned with data quality. 66% of them were using ESG software compared to only 44% of corporates.
I do think it makes sense that they’re slightly more mature in their approach. Ultimately, they are the users of financial and non-financial reporting, and they really want to assess this data to understand the risks to their investments, loans, and insurance contracts, as much as possible. I think corporates could learn, the first place would be the importance of disclosing good data and evidencing risk management to secure favorable financing terms.
An example of this in the survey was that 60% of the samples said that meeting investor lender expectations was a source of value they had seen from their sustainability efforts. I think the second point that they could learn would be to collect data themselves to see how they stack up against peers, because investors will absolutely be doing this already.
Ella: Brilliant advice, and it was really fascinating to see that split of data between the financial and non-financial organizations. So definitely worth a look into the report at those pieces. Now, one of the most promising findings from the report, especially for a company like Novata: 80% now have a formal sustainability role, which to me seemed very high, but very exciting. However, there was still clearly capability gaps that did still exist. Which skills do you think are most in demand right now if you are in the sustainability space?
Neil: I would have to temper your optimism just a little bit and acknowledge, I have to acknowledge that the sample that are responding to our survey are much more likely to have a dedicated ESG or sustainability lead because often that was the very individual who would’ve responded.
So maybe the true figure in the broader economy maybe isn’t quite as high, but encouraging nonetheless. As for the capability gaps, climate risk assessment and management came out on top here, closely followed by supply chain due diligence, although both were below the 30% marker, responses were quite distributed here. I think nonetheless, it was really interesting that these two came out on top because for me, they’re really closely related. I’m actually in the process of supporting clients with climate risk assessments and scenario analysis right now, and from experience, risks in the supply chain are an area that companies know exist and they have been affected by, but they have much less control or power to manage them. And I think this is exactly where supply chain due diligence comes in. Can you request the right information to ensure that suppliers are managing their climate related risks effectively? What are the contingency plans and do you have a geographic concentration in certain high risk areas?
Ella: And one big last question. If you had to give sustainability leaders one takeaway from this year’s report as they start to plan for 2026, we are now in November 2025 for anyone who’s listening, what would it be?
Neil: I think my main guidance would be to double down on those areas that are really material to the business and tie whatever you can back to financial performance.
Ella: Brilliant, and then we always finish episodes on three quick-fire questions. No right or wrong answers, but would love your thoughts on the following. Which single stat from this year’s report do you think will look completely different months from now?
Neil: I think the fundamentals that search for value and desire for data quality, they will remain. But who knows how we’ll be referring to ESG and sustainability in a year. So I’d maybe go with that one.
Ella: I also think people will need more than just data management and quality. The ask is gonna become more and how does that evolve is gonna be fascinating. Is there one moment in your sustainability career that has really shaped the way you work today and the way you work with your clients?
Neil: That’s a good question. I’d probably go back to my first day of my first internship at an asset manager, where my boss sat me down and told me to watch Mark Carney’s speech at a Lloyd’s insurance event called “Breaking the Tragedy of the Horizon.” I’d encourage you to watch it, although 28 minutes long. But it essentially laid out a lot of the core principles that underpinned the need for the Task Force for Climate-Related Financial Disclosures, which he was quite heavily involved in.
Ella: Great. Mark Carney’s speech will definitely be on my listening list this weekend. And finally, last but not least, what’s one sustainability imperative you don’t think is getting enough attention at the moment?
Neil: I think I’ll stay on that theme of climate risk and resilience, and I would maybe say that the IFRS Sustainability Standards. I love the way that they’re positioned, linking to finance, aiming to make non-financial reporting globally consistent akin to financial reporting.
Ella: Brilliant. Neil, thank you so much for all your insights. If you haven’t had a chance to look at Novata’s State of Sustainability report, it is linked to this episode, so please do take a look. My key takeaways from today, I’ve certainly learned a lot. Number one, spreadsheets can be complimentary to using an ESG tool, but spreadsheets alone are not enough due to the lack of audit trail. Good data quality really is the foundation of being able to show value and ROI for your business. And doubling down on what’s material for your business based on the industry you are in and the clients that you serve is a really good place to start. But my favorite takeaway has to be, making sustainability groovy again.
So thank you so much, Neil. Until next time, let’s keep building sustainable intelligence together. Find out more at novata.com.
