The rise of sustainability reporting

Over recent years, a number of trends have come together to result in the rise of sustainability reporting. This content has been present for a while to differing extents, but with the IIRC driving integrated reporting and the GRI standardising sustainability reporting, stakeholder expectations are clearly evolving.

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In evidence of its importance, as of 2014, 42 of the 100 largest businesses in the UK produce a separate report dedicated solely to their corporate responsibility and sustainability story.

Sticking with the Annual Report though, where it was once confined to a single spread and often placed haphazardly somewhere between risk and governance, or even inside governance, sustainability content has been steadily gaining prominence and creeping forward within the document.

In fact, in best practice reports it has spread like wildfire, infiltrating other key non-financial information sections – business model, strategy, KPIs and risk, for instance.

This is all tied in to the concept of materiality, i.e. this information is more important to both your business and your stakeholders than it has ever been before and, where possible, should have a place in every section of your report.

Whether you go all out and address the six capitals of <IR> (financial, manufactured, human, intellectual, natural and social) or just the three elements of sustainability performance reporting identified by the GRI (economic, environmental and social), you need to be aware of your material issues.

Ask yourselves some questions. Is your business committed to reducing its impact on the environment? Include it in your strategy. Are you dedicated to developing your staff? Discuss why not doing this would constitute a risk. Do you measure your positive impact on the community? Discuss it in your performance.

Even if you’re not ready to integrate sustainability into these sections, signposting to this content where relevant can also demonstrate your commitment and aid the audience interested in this information.

Obviously, sustainability reporting is more important to some businesses and industries than others, but always remember, honesty and transparency are the keys to successful sustainability content. Don’t claim to be doing things that you’re not or promise to do things you cannot deliver; simply be open and detail your journey accurately.