In the beginning of November, leading sustainability initiatives announced that a two-year project has been launched focusing on driving a better reporting alignment in the corporate (sustainability) reporting landscape. This topic has still connections to our published blog post from the 26th Sep. 2018 (GRI and SASB are planning to align their standards) and is part of the sustainability reporting trends and developments (see also blog post from 14th Nov. 2018). This blog post now focuses on the reporting alignment efforts of leading sustainability frameworks headed by the Corporate Reporting Dialogue. But first, background information related to the Corporate Reporting Dialogue will be given.
How the story has begun – Founding the Corporate Reporting Dialogue
Four years ago, the Corporate Reporting Dialogue was found, aiming at an ongoing dialogue and a better reporting alignment between the key standard setters and the framework developers which have a high influence on the corporate (sustainability) reporting landscape. Leading (sustainability) initiatives like the CDP (formerly: Climate Disclosure Project), Climate Disclosure Standards Board (CDSB), Global Reporting Initiative (GRI), International Accounting Standards Board (IASB), International Organization for Standardization (ISO) and the Sustainability Accounting Standards Board (SASB) are part of it, convened by the International Integrated Reporting Council (IIRC). Also, the Financial Accounting Standards Board (FASB) is part of the dialogue initiative which has the function as an observer.
Key tasks of the Corporate Reporting Dialogue during regular meetings are, for example:
- Communicate about the direction and developments of reporting frameworks and standards
- Identify ways by which frameworks and standards can be aligned
- Share information
The work of the Corporate Reporting Dialogue is important because it forms a key link between leading (sustainability) reporting initiatives. They ensure that the corporate reporting landscape is easily navigable, foster the efficient and effective sustainability reporting and express a common voice within the reporting landscape.
Aiming for a better reporting alignment – a two-year project
The Corporate Reporting Dialogue has launched this two-year project which will be funded by Bloomberg Philanthropies. This project should help map commonalities and differences between leading frameworks to ensure a better reporting alignment. Furthermore, the integration of non-financial disclosures in financial reports will be further promoted to achieve a better understanding between non-financial and financial information in relation to a companies’ risks and opportunities. Main promoters in this context are the IIRC and the CDSB.
In addition, the SASB, GRI, CDP and CDSB will map their frameworks against the Task Force for Climate-related Financial Disclosures (TCFD) recommendations. The TCFD supports companies in understanding how climate change and related aspects influence a companies’ financial performance (see also blog post from 14th Feb. 2018). In this context the mapping against the TCFD framework supports further integration of financial with non-financial reporting, through identifying how non-financial aspects relate to financial outcomes and how these can be integrated in mainstream reports.
First outputs and intermediate results are expected in the third quarter of 2019. The Corporate Reporting Dialogue is planning to inform about the progress on a regular basis.
DFGE’s opinion and support
In our point of view, it is a good project as the reporting alignment of leading reporting frameworks reduce a companies’ burdens and reporting efforts and increase efficiency. Furthermore, the promotion of understanding the connection between non-financial and financial aspects is positive to address investor needs and to secure the economic sustainability of a company. However, the investor focus seems to be very strong in this context. Although investors are key, there are also other (key) stakeholders for a company which should be also addressed by such a project. Indeed, a holistic stakeholder approach and the serious inclusion of their needs and interests is a key driver of a companies’ sustainability performance.
We will keep you informed about this project in the future.
In cases of any reporting requirements your company is faced with DFGE will support you based on your individual needs, e. g. by creating a sustainability report that is in alignment with UN Global Compact or GRI recommendations. Furthermore, we will support you in ratings like CDP or EcoVadis. We will improve your Sustainability Intelligence. In cases of any questions regarding this topic or our support, don’t hesitate to contact us via email@example.com or +49.8192.99733-20.