ESG reporting has yet to take off significantly. However, there are encouraging signals since several governments worldwide have made ESG disclosure mandatory, and there are a variety of reporting standards available, including those by SASB.
Choosing how and where to spend their efforts and resources to give their stakeholders the information they want is the difficulty businesses confront regarding ESG reporting. The five steps that follow provide some direction.
Step 1: Determine the Goals You Have for Your Report.
Depending on where you are in your ESG journey, a number of these objectives may apply to your initial report:
- Share your current ESG approach and how it relates to your overarching company goals.
- Describe the ESG programs, policies, and processes you have in place.
- Update us on your ESG objectives, results, and metrics.
- Determine the ESG concerns that are most important to your company and its stakeholders and show that you are involved in these issues.
- Encourage buy-in across the organisation for “the business case” for ESG and link to your revenue.
Step 2: Create a Realistic Reporting Timeline.
Reporting on ESG is a journey. With a staged approach to ESG reporting, you may go slowly and focus on an acceptable reporting cadence that you can commit to. Start with a biannual report and provide sporadic updates on your website and social media platforms.
Perhaps your plan might include sporadic reports tailored to certain locations or businesses or developing a fantastic website with updated material between scheduled reporting intervals.
Companies can create a reporting roadmap that meets their goals without governmental reporting obligations. Whatever you decide, submitting your first report is a significant milestone and the first in a series of ESG communications.
Step 3: Include Relevant Examples, Best Practices, and Frameworks for Voluntary Disclosure.
Finding firms that have just begun ESG reporting is a wonderful place to start your journey (which may mean looking outside your peer base). You may find examples of this type by searching the web for “first sustainability report.”
Review your peers’ ESG communications to learn industry standard practices and expectations, especially if their reporting is farther ahead. And lastly, even if you choose not to proceed with complete reporting to any specific standard, several voluntary disclosure frameworks provide ideal beginning places.
The most prominent frameworks are:
- The first, most commonly used, and most comprehensive worldwide standards for sustainability reporting are included in the Global Reporting Initiative (GRI).
- For companies to convey financially significant sustainability information to their investors, the Sustainability Accounting Standards Board (SASB) has developed 77 sector-specific sustainability accounting standards.
- The Task Force on Climate-related Financial Disclosures (TCFD) creates suggested disclosures about financial risks associated with climate change that businesses can use to inform investors, lenders, insurers, and other stakeholders.
Step 4: Make It a Point to Consider the Greater Picture.
Be prepared if the ESG reporting process encourages your company to look more broadly at its place globally and its potential for development.
Building confidence in ESG communications requires transparency, and stakeholder expectations for a deeper understanding of risks and opportunities are constantly rising.
Acknowledging what work still needs to be done and the more significant ESG concerns that can influence your firm is vital to publicising your ESG achievements.
Step 5: Plan Everything Out!
When you are prepared to start working on your first report, take some time to evaluate your internal resources. Then, allocate roles and duties as necessary. Ensure that all pertinent internal departments (including the C-Suite, investor relations, investor relations, human resource management, legal, compliance, marketing, and marketing) are aware of their responsibilities.
Based on the availability of internal and external resources, establish a reasonable timetable and budget. Also, remember to use the ESG content you already have; find details from your current materials to incorporate in your report, and push colleagues to share what they are currently doing.
In Conclusion-
ESG consulting and reporting may benefit your company and give you a competitive edge with investors, clients, or staff. Finally, do not be reluctant to ask for assistance. You can always get help from SG Analytics. If you need guidance with your ESG reporting, contact us quickly. Our ESG services will get you started right away.
