The analysis comes from the fifth edition of Carrots & Sticks (C&S) database analysing corporate reporting frameworks. The analysis covers 614 reporting requirements and resources, which has increased from 383 in 2016, across 80 countries.
According to C&S, environmental, social and governance (ESG) disclosure is becoming mainstream globally, with a multitude of frameworks and requirements now attempting to provide investors with quality corporate data. In November 2019, C&S announced a new partnership with the Reporting Exchange of the World Business Council for Sustainable Development to improve user access to reporting information by aligning their taxonomies.
Additionally, the Sustainable Development Goals (SDGs) are becoming commonplace across all sustainability reporting policies, requirements and frameworks. However, C&S notes that current corporate disclosure aligned to the SDGs is limited, and progress is often badged against broader SDG themes than the underlying target. SDGs 12, 6 and 8 are commonly used, while ones focusing on health and education are expected to grow in use following the coronavirus pandemic.
“As the pandemic focuses the attention of policymakers on how to achieve resilient and climate-friendly economies, the importance of measuring the impacts of companies and encouraging sustainable practices increases. It is positive therefore that both the range and depth of ESG reporting provisions around the world has grown substantially,” GRI’s chief external affairs officer, Peter Paul van de Wijs said.
“Yet questions remain on how to address gaps, particularly in the context of the SDGs, and improve coordination to support more consistent disclosure. To address this twin challenge – spreading the practice of disclosure and driving up the quality – needs strengthened reporting requirements, for which GRI will play an enabling role.”
Van de Wijs’s comments echo one of the findings from C&S, that alignment across the plethora of reporting frameworks and requirements is lacking. C&S is calling for greater collaboration across standards in order to streamline the reporting requirements for corporates, which in turn should improve the quality of disclosure.
On the ESG front, for example, 245 reporting instruments exist in Europe alone, with an additional 174 in Asia and 47 in North American markets. By streamlining ESG requirements, investors will have access to more unified data across a spectrum of corporates.
The amount of reporting provisions issued by government bodies has risen by 74% since 2016 to just short of 400. Engagement with the finance sector through reporting has also grown “significantly” in that time.
The C&S report comes as the International Association for Sustainable Economy (IASE) launches a new benchmarked accreditation scheme for ESG professionals. The online platform will help to certify professionals in the field of ESG in an attempt to help companies and customers improve knowledge of the importance and requirements of ESG.
IASE’s chair Javier Manzanares Allen commented: “IASE seeks to be the reference in ESG at an international level that aspires to deepen the sustainable development of our society by certifying professionals in ESG matters and in an environment of continuous innovation.
"The Association will initially have two types of certifications, the first (International Sustainable Finance) aimed at the financial sector, with specialisations in the banking, insurance, savings banks and microfinance sector, and the second (International Sustainable Business) aimed at the business sector. The IASE qualifications have been designed in collaboration with highly experienced ESG professionals from multiple geographies and industries around the world. “
The new IASE accreditation scheme will be supported across more than 25 countries worldwide including UK, Germany, France, Italy, Spain, China, South Korea, India, USA, Canada, Mexico, Colombia and South Africa.
https://www.edie.net/news/7/ESG-disclosure--firmly-in-the-mainstream--for-corporate-reporting/