A small guide to a big world of reporting standards (1/2)

Nina van Rijn


4 minutes



Non-financial reporting is key in our fight against environmental degradation and climate change. And according to KPMG, around 80% of all companies worldwide voluntarily now report on sustainability. That’s fantastic of course. But with so many frameworks, standards, guidelines – some of them voluntary, some of them obligatory regulations – the landscape can be quite daunting. Taking off is challenging and keeping up with this rapidly evolving world even more so.

July 26, 2021
JJ Ying

In this article, we take you through four of the most important standards and guidelines: CDP, CDSB, GRI and IIRC. In our next article of this series, we will talk about SASB, UN SDG’s, PRI and TCFD. Later, we will explain what’s to come in the future.

Carbon Disclosure Project (CDP)

Participants: Non-financial corporates
Audience: Investors
Focus area: Environment (climate change, water security and deforestation)
Created in 2007

CDP is a non-profit offering a global disclosure system for companies and cities. Cities and companies are asked to fill out a yearly questionnaire, with questions on – among others – greenhouse gas emissions in scope 1, 2 and 3; fuel used per fuel type; climate related engagement strategies with customers; and activities regulated by a carbon pricing system such as ETS. The questionnaire follows the TCFD recommendations.

Subsequently, CDP scores these cities and companies based on their disclosure performance and environmental performance. The so-called A list – containing over 300 leading companies – is published every year. In 2020 this list included Danone, HP and L’Oréal. The goal of this A-list is to nudge them to move towards more environmental friendly business models.

By gathering this wealth of data every year, the CDP owns one of the richest and most comprehensive dataset on environmental strategies, action and performance.  

In our opinion, the fact that CDP offers a yearly questionnaire has both pros and cons. Pro: since this system is highly standardised, benchmarking and tracking progress on a very large scale is possible. Con: it offers little flexibility to be tailored to your specific organisation (think of choosing your own material/important topics), and because frequency is so low, it’s not very informative on week-to-week or month-to-month variance in your sustainability efforts that could help you re-strategize timely.

Climate Disclosure Standards Board (CDSB)

Participants: Non-financial corporates
Audience: Investors and shareholders
Focus area: Environment
Created in 2007

CDSB is an international consortium of NGOs that offers companies a framework for environmental reporting with the same rigor as financial reporting. CDSB seeks to standardise environmental reporting by tracking and collaborating with the most widely used reporting standards. This is aligned with the TCFD and the CDSB supports compliance with the EU’s Non-financial Reporting Directive.

In their guidelines, CDSB proposes a list of 7 reporting principles for corporates to follow, such as “Disclosures shall be faithfully represented”, “Disclosures shall be verifiable” and “Disclosures shall be clear and understandable”. Besides this, CDSB also provides 12 reporting requirements, designed to encourage standardised disclosure of environmental information for mainstream reports. An example: “Quantitative and qualitative results, together with the methodologies used to prepare them, shall be reported to reflect material sources of environmental impact.”

CDSB does not provide its own metrics, but instead brings together other frameworks (such as SASB, GRI and CDP) and then offers a guide explaining how the information from those standards can be structured.

International Integrated Reporting Council (IIRC); International <IR> Framework

Participants: Financial institutions and non-financial corporates
Audience: Investors and shareholders
Focus area: Sustainability
Created in 2010

While the other organisations and standards in this article focus on sustainability disclosure, the IIRC provides an integrated reporting framework to connect sustainability disclosure with financial disclosure: International <IR> Framework. The aim of IIRC is to create a world in which capital is allocated based on a combination of both financial stability and sustainability.

IIRC sees itself as the provider of a system for corporate reporting 2.0. Reporting that is more about value creation in general. This can be financial value, but also manufactured, human, social, intellectual and natural capital. Since it is our mission at Salacia to help companies bring their financial position and sustainability more in balance, we are quite happy with IIRC’s work.

The I <IR> Framework gives 7 guiding principles explaining how the information should be presented. Think of ‘Connectivity of information’: “An integrated report should show a holistic picture of the combination, interrelatedness and dependencies between the factors that affect the organization’s ability to create value over time”. On the other hand, I <IR> Framework prescribes 8 content elements, in the shape of questions to be answered. For example, for the element ‘Governance’, organisations should answer: How does the organization’s governance structure  support its ability to create value in the short, medium and long term?

IIRC recognizes it’s necessary to use both qualitative and quantitative information to properly present an organisation’s value creation. It is up to the reporting organisation to choose whether to use quantitative indicators to support their reported value or not, and for which topics to use quantitative indicators.

IIRC has very recently – June 2021 – merged with SASB into the Value Reporting Foundation.

Global Reporting Initiative (GRI)

Participants: Governments, financial institutions, non-financial corporates
Audience: General stakeholders
Focus area: Sustainability (economic, environmental and social)
Created in 1997

The oldest of the bunch. The GRI Standards are very widely used by corporates worldwide. They are designed for organisations to report on their impact in a credible and consistent way. They are modular, which means companies select the topics that are most important to them.

Examples of the 8 environmental topics to choose from are materials, energy, biodiversity and supplier environmental assessment. Within these topics, GRI explains in clear and concise language what to disclose and how to qualify or quantify each indicator. For example, GRI 301 is about materials. One of the indicators to disclose is percentage of recycled input materials used, which determined by dividing the total recycled input materials used by total input materials used.

Salacia automatically generates your GRI-compliant report for all quantitative indicators of your choice. In our view, the GRI standards are the most generally useable standards: they can be applicable to any company in any sector.

Want to know more on how Salacia can help you generate reports following the above mentioned standards? Get in contact!

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