Sustainability Reporting 101

As the importance of sustainability issues and their relevance to corporate interests continues to become more widely recognized, so too will the demand for organizations to be transparent about their ESG performance. To address these concerns, companies typically resort to publishing their own sustainability report, or submit to one or several of the industry frameworks that exist. In the below blog post, we will review the different frameworks as well as best practices for releasing your own sustainability report.

GRI (Global Reporting Initiative) defines sustainability reporting as the practice of companies disclosing the most significant economic, environmental, and social impacts that arise from their corporate activities, and thereby being held accountable for these impacts and responsible for managing them.

Why is Sustainability Reporting Important?

According to a PWC and Workiva survey, business executives recognize the importance of ESG reporting, with 89% already reporting ESG data. Sustainability concerns have changed the way many investment and capital allocation decisions are made. It is clear that sustainability has significant value to investors.

A new survey by Morningstar found that out of 500 asset owner fiduciaries, 85% said that ESG factors are “very material” to the investment process. These preferences should not be overlooked by the everyday business decisions of firms, and it is clear that sustainability reporting is becoming necessary for all companies.

How to Start Sustainability Reporting:

Many companies choose to craft a unique internal corporate sustainability report that cross-references key information from several reporting frameworks as a useful guide. These reports are meant for marketing purposes, public audiences, and stakeholders. Whether it is voluntary or simply mandated by relevant governing bodies, companies will also report information to specific frameworks, standards, or rating agencies with the appropriate requirements met for the framework(s) in question, as well as craft internal reports following the exact requirements of certain frameworks.

Overview of Sustainability Reporting Standards:

The sustainability reporting framework landscape is crowded, complicated, and costly. Investors are losing confidence in the sustainability reports of individual firms because the information varies so widely from one company to another. It is important to follow common and widely recognized standards, as it marks sustainability reports as qualified and more mature.

The International Financial Reporting Standards (IFRS) Foundation is working towards the creation of a global baseline set of sustainability reporting standards and the creation of the International Sustainability Standards Board (ISSB). Their goal is to arrive at the same level of maturity for sustainability reporting as we see in the modern financial reporting system.

ISSB builds on the work of market-led investor-focused reporting initiatives—including the Climate Disclosure Standards Board (CDSB), the Task Force for Climate-related Financial Disclosures (TCFD), the Value Reporting Foundation’s Integrated Reporting Framework and industry-based SASB Standards, as well as the World Economic Forum’s Stakeholder Capitalism Metrics. While ISSB as a standard setter is not mandatory for individual firms to follow, individual jurisdictions and regulators are likely to adopt or otherwise use these standards in their rule making.

As climate change becomes more prevalent, companies will face increasing pressure to release sustainability disclosures. These sustainability reports are essential for stakeholders and consumers to understand overall company performance, for their economic achievements and environmental and social well-being. By closely adhering to a widely acknowledged standard such as the ISBB, companies can remain competitive and show increased transparency and reliability to their stakeholders and consumers.

How WatchWire Can Assist Your Company With Sustainability Reporting?

Seems overwhelming? Not to worry, WatchWire is here to help you navigate sustainability reporting and simplify the process as much as possible!

WatchWire is an integrated energy and sustainability management platform that streamlines, automates, and standardizes your sustainability reporting process. WatchWire allows users to track their sustainability goals with real time monitoring of KPIs and benchmarks, while simultaneously identifying key metrics like underperforming assets, offsets, and dollar impact for savings. With WatchWire, users are able to achieve near 100% data coverage via our ongoing automated data capture approach.

WatchWire also reports to GRESB, SBTI and other frameworks, while providing customizable financial grade report generation and advice on reporting, working to make sustainability reporting as easy and seamless as possible for users.

To discover more about WatchWire and its sustainability reporting capabilities, you can visit our website, blog, or resource library, request a demo, or follow us on LinkedIn, Instagram, or Twitter to keep up-to-date on the latest energy and sustainability insights, news, and resources.