For a second year Projective Group has conducted an extensive study into into the non-financial material risk disclosures of the world’s largest banks, insurers, asset managers, financial market infrastructures (FMIs) and law firms.
It includes more than 1,500 individual disclosures taken from the annual reports of 170 organisations across 22 countries and reveals striking shifts in corporate risk priorities and reporting practices. Despite an unavoidable data lag of six months, our findings show strong directional trends and regional divergence that provide clear market insights for industry leaders and risk assessment teams.
Preview the findings below, then download the full report to see where you really stand.
Perhaps the most significant finding is the explosive adoption of Double Materiality Assessments (DMA). This process (mandated under the EU Corporate Sustainability Reporting Directive (CSRD)) requires organisations to evaluate risks from two critical perspectives: how external environmental, social, and governance (ESG) factors impact financial performance, and how business operations affect people and the environment.
The numbers tell a compelling story. Between 2024 and 2025, firms adopting DMA reporting increased by 46%, with 70% of studied organisations now disclosing DMA findings compared to just 51% in 2024. Tellingly, the growth in adoption of DMA’s extends far beyond Europe, where the CSRD mandates such reporting, indicating a global shift in corporate transparency expectations. New EU regulations (CSRD, SFDR, EU Taxonomy, and ESMA's green finance strategy) are increasing sustainability disclosure requirements for financial institutions at both entity and product level.
Global priorities remain alignedwith the 5 most cited material topics for each region (Europe, APAC and North America) broadly consistent. They prioritise robust governance, climate change, and own workforce. However, regional divergence is clear. Local political, regulatory, and contextual factors significantly influence what firms report as material.
Beyond compliance, growth in the DMA approach reflects a broader transformation in corporate identity: from focusing narrowly on shareholder value to assuming responsibility across the value chain.
More lukewarm adoption in North America – reflected throughout the piece…
DEI in Decline ?
Disclosures of Diversity Equity & Inclusion (DEI) as a material topic fell by 13% globally. This was predominantly driven by a 33% drop in North America, the likely result of a changing political narrative. In Europe, the drop in companies prioritising DEI was 12%.
Talent retention priorities have weakened, potentially indicating ‘the war for talent’ has begun to cool as new technologies (e.g., AI) combine with a more competitive labour market, and tightening staff investment budgets.
A More Selective Focus
While more companies are conducting materiality assessments, they are also becoming more selective about what they disclose. The average number of risk disclosures has decreased from 12 to 11.
This refinement reflects a maturing approach to risk assessment, where quality and relevance are more important than quantity.
Spotlight on Environmental Risk
Environmental factors have emerged as the fastest-growing category of disclosed risks, jumping from 27% of all disclosures in 2024 to 31% in 2025. Climate change mitigation has kept its ranking as the second most disclosed risk overall, while climate adaptation and biodiversity concerns have seen dramatic increases in attention, climbing 9 and 5 places in the overall rankings respectively. The only exception was sustainability linked products and services. Disclosures for this topic fell by 25% in 2025, perhaps reflecting the difficulties in their delivery and “hype fatigue”.
Governance Reframed
Governance topics continued to account for a third of the 1,500 disclosures cited. This suggests companies are using DMA frameworks beyond mere regulatory compliance. However, the share of governance topics shrank slightly compared to 2024.
Governance also had the widest diversity of topics. Many of these were not directly referenced by the CSRD but instead addressed by other regulations e.g. financial crime and sanctions, operational resilience, whistleblowing and AI.
Traditional governance concerns like corporate ethics and regulatory compliance remain paramount, but emerging issues are gaining traction. Digital transformation risks, including data privacy, cybersecurity, and artificial intelligence, are increasingly recognized as material concerns, though adoption remains surprisingly limited given their potential impact.
Differences - Legal v Financial Companies
Our study reveals significant differences between legal and financial services firms in their approach to non-financial risk disclosure. Law firms lag considerably in DMA adoption, with only 36% publishing assessments compared to higher rates in financial services.
Key areas for Growth
References to demographic change doubled. In 2024, only Japanese firms focused on aging populations, since then European firms have added migration's impact on demographics and politics.
Whistleblower protection citations increased 300%, driven probably by the EU Whistleblower Protection Directive. A higher overall ranking may be achieved when companies list this separately rather than under the umbrella of business ethics.
Looking Ahead – Predictions for 2026
The data used to compile this report would suggest that DMA will become the global standard for large public companies as CSRD requirements embed across markets. However, questions remain about whether financial services organisations, particularly in the US, will follow the legal industry's retreat from DEI and sustainability topics amid changing political pressures.
Our study anticipates continued growth in disclosure of non-traditional ESG topics, including financial crime, artificial intelligence, and cybersecurity risks, though adoption rates remain surprisingly low given their potential business impact.
Key Takeaways
Industry leaders and risk assessment teams should be ready to embrace DMA frameworks as they become a critical tool in the arsenal for risk assessment teams. There needs to be a sharp focus on key material risks in preparation for regulatory convergence as European standards influence global practices.
Emerging risks in technology, cybersecurity, and geopolitics need to be closely monitored. All of the above need to be achieved whilst navigating the political sensitivities around ESG and DEI topics and maintaining stakeholder trust.
Organisations that adapt thoughtfully to these changes will be better positioned to navigate an increasingly complex risk landscape while maintaining stakeholder confidence and developing greater operational resilience.
For clients seeking a deeper dive, Projective Group offer tailored benchmarking reports, including one-on-one sessions with our non-financial risk team. Our experts will help you to work out how your company fares against your peers, and highlight any potential blind spots in your materiality assessment.
Highlights are just the start – download the full report for the insights that matter most.
Über Projective Group
Gegründet im Jahr 2006 ist die Projective Group ein führender Spezialist für Change im Financial Service Bereich.
In der Branche sind wir als umfassender Lösungsanbieter anerkannt und arbeiten partnerschaftlich mit unseren Kunden zusammen, um ganzheitliche und pragmatische Lösungen zu bieten. Wir haben uns zu einem vertrauenswürdigen Partner für Unternehmen entwickelt, die in einer sich ständig wandelnden europäischen Finanz- und Unternehmenslandschaft erfolgreich sein und wachsen möchten.
