Substantial increase in sustainability reporting regulations around the world Tweet This!
According to a new report environmental, social and governance (ESG) disclosure has never been more pervasive globally.
The fifth edition of Carrots & Sticks (C&S) offers an analysis of the latest trends in reporting provisions. It covers 614 reporting requirements and resources in over 80 countries, which include the world’s 60 largest economies.
Key findings include:
- The Sustainable Development Goals (SDGs) have become a global reference for sustainability reporting policy.
- Europe continues to drive the ESG disclosure agenda, accounting for 245 reporting instruments.
- Most reporting provisions are issued by governmental bodies, rising by 74% since 2016 to almost 400.
- Alignment in the sustainability reporting field is still falling short. Greater collaboration is needed between standard setters, reporters, information users, regulators and policymakers.
Carrots & Sticks is an initiative of GRI and the University of Stellenbosch Business School (USB), with contributions by the UN Environment Programme (UNEP).
Peter Paul van de Wijs, GRI Chief External Affairs Officer said:
“As the pandemic focuses the attention of policymakers on how to achieve resilient and climate-friendly economies, the importance of measuring the impacts of companies and encouraging sustainable practices increases. It is positive therefore that both the range and depth of ESG reporting provisions around the world has grown substantially.
Yet questions remain on how to address gaps, particularly in the context of the SDGs, and improve coordination to support more consistent disclosure. To address this twin challenge – spreading the practice of disclosure and driving up the quality – needs strengthened reporting requirements, for which GRI will play an enabling role.”
Cornis van der Lugt, Senior Lecturer Extraordinaire, USB, said:
“Stock exchanges and central banks are becoming more active in pursuing non-financial reporting requirements. This shows how the economic and market implications of diverse ESG topics are becoming more evident. The obvious example is climate-related disclosures. After 2020, the systemic implications of public health and infrastructure weaknesses is likely to receive more attention as well.
The regulatory landscape both reflects and drives perceptions of what are key material themes. Related is the question of target audience. The landscape continues to display confusion about where best to disclose information and who is supposed to be using different types of information.”
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