New CSRHub e-Book Reveals How Sustainability Disclosure Impacts Ratings

(3BL Media/Justmeans) – Over the past 10 years, there has been a significant increase in the number of corporations that disclose sustainability-related information. More recently, investors have become interested in corporate sustainability performance. Today, more than $62 trillion of worldwide wealth is managed by firms that have committed to the UN Principles of Responsible Investment (UNPRI).

Tracking these global corporate sustainability trends, CSRHub has now released its second e-Book in the new series, How to Improve Your CSR Score, sponsored by Triple Pundit. “Ratings and Frameworks: Where is the Puck Going?” is now available for download. The e-Book has been co-authored by Cynthia Figge and Bahar Gidwani, who are also the co-founders of CSRHub.

The book begins with a quote of hockey player Wayne Gretsky, who said, “I skate to where the puck is going to be, not where it has been.” In a similar vein, the book examines the changes in the CSR/ESG/Sustainability disclosure landscape to understand “where the puck is going.”

Where has the puck been?

According to the authors, the dependency on self-reported data and surveys has created gaps and inconsistencies in sustainability ratings. Fewer than 20 percent of major companies respond to analyst surveys and these surveys only cover the top 5,000 or 6,000 public firms. The data gathered by one NGO cannot be used in a survey response or for the system used by another NGO.

Where the puck will head next?

Over the past few years, several new reporting groups have emerged. Each has a different focus, but all are based around standards they believe should be integrated into publicly-disclosed reports. Examples include the Sustainability Accounting Standards Board (SASB) and Task Force on Climate-related Financial Disclosures (TFCD). There have also been efforts from government bodies and securities regulators to get involved in this integration process.

Change the way you play

The authors estimate that thousands of companies who have already started reporting sustainability information will be affected by these changes. Even more important, thousands of companies who have never reported non-financial sustainability information will now need to do so.

To comply with these new standards, companies will:

  • Need new systems that integrate CSR data with mainstream business management tools.
  • Require support from Audit and Compliance teams for C-suite assurance.
  • Involve suppliers and customers to share data collection while preserving proprietary information.

The authors recommend that companies that are not already reporting should get started with at least one of the standards described in the book. To download, click here.

Source: 3BL Media