A great deal of effort is being channeled into making the world as sustainable as possible; this includes efforts by individuals, organizations, and businesses seeking to contribute their quota to preserving sustainability. Given the new dawn of sustainability, it is increasingly paramount to assess and review activities and promote accountability in both the public and private sectors through sustainability reporting. Sustainability reporting takes on different conceptual frameworks with significant differences in their underlying principles and criteria for measuring the performance of entities in the economic, social, and government arms of sustainability. Here is a look at the types of sustainability reporting.
Types of Sustainability Reporting
Knowledge of the varying types of frameworks is necessary to help your organization set its priority and choose which framework to adopt. Here are five of the most common reporting frameworks:
- The Global Reporting Initiative (GRI): The GRI is one of the foremost sustainability reporting frameworks. It has reporting standards that help organizations reveal the impacts of the activities on the environment, society, and economy. These standards of ESG reporting apply to a wide range of sectors and are wide-ranging in the options for reporting. It provides organizations with two main divisions: the Universal Standards and The Topic Specific Standards, which also have branching subcategories. While this is one of the most comprehensive ways of sustainability reporting, it can be overbearing for people new to reporting sustainability.
- Sustainability Accounting Standard Boards( SASB): The sustainability accounting standards board is part of the Value Reporting Foundation and hammers investors’ need to evaluate investment risks and opportunities. The SASB standards vary for different individual sectors and contain documents that spotlight industry-specific sustainability challenges. SASB has 77 industrial standards for 77 industries which are grouped into about 11 groups.
- Integrated Reporting Framework: The integrated framework reporting is now incorporated with the SASB as a part of the Value Reporting Foundation. This reporting framework integrates necessary information about a company or organization’s strategy, governance, and performance. The core of the IR framework is an eight content element with guiding principles and detailed descriptions of some fundamental concepts which encompass a business model, strategy, resource allocation, outlook, and the basis of the presentation of the report. The major benefits of the IRF are quality information to financial stakeholders to guide decisions on capital allocation and help organizations present comprehensive yet concise details about the creation of value across different aspects.
- The carbon disclosure project: The carbon disclosure project mandates reports about greenhouse gas emissions as well as government actions and strategies to alleviate climate change and deforestation. The CDP scores companies based on disclosure, awareness management, and leadership. The CDP pushes for sustainability and accountability by encouraging companies to measure and manage their environmental risks and improve operational efficiency. It is an online reporting system that is then scored in the carbon disclosure leadership index.
- Sustainable development goals: The sustainable development goal was developed by the United Nations in 2015 and highlighted issues about ESG. The goals are 17 and comprise specific and actionable targets. The SDGs reveal certain goals and require that companies make reports on their efforts towards the goals. The drawback with this reporting is that it is qualitative less than a quantitative measure of progress. Regardless of the type, sustainability reporting is set to attain the same goal of accountability and promoting environmental, social, and governance wholesomeness.
Finally, the reporting framework to adopt is based on an appraisal of the different types to determine which suits your organization earnestly.