Corporates Often Pick’n’Mix Reporting Frameworks – GRI and SASB

While they wait for harmonised sustainability reporting standards, corporates are reporting to multiple frameworks, survey shows.

Corporates can provide comprehensive sustainability disclosures by reporting in line with multiple disclosure frameworks, according to a new report by the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB).

A survey of 132 reporting organisations revealed that 52 (39%) use both GRI and SASB Standards. The three industries with the highest proportion of companies using both frameworks were infrastructure (50%), food and beverage (60%) and healthcare (83%).

The report provides in-depth case studies from four global companies that have been long-term GRI reporters and also now report with SASB: Britain’s Diageo, Singapore-based City Developments Limited, US-headquartered General Motors and Canada’s Suncor Energy.

The report acknowledges differences in the approaches of the two bodies. GRI-aligned reporting focuses on corporates disclosing their most significant economic, environmental and social impacts, whereas SASB-aligned reporting centres around how sustainability issues are creating or eroding enterprise value.

A combination of the two allows corporates to provide investors with more insight across both impacts and enterprise value, it says.

Experts recently spoke to ESG Investor about the different proposed approaches to standards consolidation by the International Financial Reporting Standards (IFRS) Foundation and the European Financial Reporting Advisory Group (EFRAG), which advises the European Commission.

The IFRS Foundation, similarly to SASB and merger partner the International Integrated Reporting Council (IIRC), aims to build a standard that focuses on enterprise value, taking a more gradualist approach. In contrast, EFRAG will align more with the GRI framework and will apply a double materiality lens.

However, GRI and SASB are working together “to support companies that want to communicate with their various stakeholders using both the GRI Standards and SASB Standards”, the report said.

“By sharing practical experiences, we are enabling companies to determine the sustainability reporting path that is right for them, based on the needs of their stakeholders. I believe it will improve understanding of the differences between GRI and SASB Standards and, importantly, ways in which they can be used concurrently,” said Eric Hespenheide, GRI Chairman.

As two members of the ‘group of five’ reporting standards-setting bodies, alongside CDP, Climate Disclosure Standards Board (CDSB) and IIRC, they recently produced a climate-focused standardised sustainability standard which will be used by the IFRS Foundation.

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