Have your say on recommended SDG Disclosures
By Carol Adams
19 August 2019
As reporting organisations start to incorporate the UN SDGs within their strategy and business models, a consultation on a proposed framework for recommended disclosures is issued for public comment.
The UN Sustainable Development Goals (SDGs) address issues that impact on long term business success, the health of our planet’s natural environment and the well-being of its people. Businesses, asset owners and asset managers are recognising the risks and opportunities arising from issues such as poverty, inequality, climate change and environmental degradation. They are incorporating them into strategy and adjusting business models. But more needs to be done and faster.
Acknowledging the role accountants play in the provision of information for decision making and the power of collaboration on these important issues, the Association of Chartered Certified Accountants (ACCA), Chartered Accountants Australia and New Zealand (CA ANZ) and Institute of Chartered Accountants of Scotland (ICAS) have jointly published Recommendations for SDG Disclosures: A consultation paper authored by Professor Carol Adams, Russell Picot and Paul Druckman.
Adams, Picot and Druckman draw on their work with guidance/standard setters such as the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC), the Taskforce on Climate related Financial Disclosures (TCFD) and the UK Financial Reporting Council (FRC) when developing the recommendations. They use their engagement with relevant policy developments such as those of the UK Government’s Taskforce on Impact Investing and Green Finance Inquiry, corporate governance consultations by the ASX and UK FRC and the Australian Senate Inquiry on the SDGs to inform the paper. The document has benefited from input from a number of experts.
The proposed recommendations
The proposed recommendations for SDG Disclosure are designed to be used in conjunction with existing reporting Frameworks and be neutral with respect to them. The recommendations are also SDG specific, recognising the complexity and interconnectedness of the sustainable development issues that the SDGs address.
The Recommendations for SDG Disclosures are grouped into four themes:
- Management approach (which includes risk management)
- Strategy
- Governance
- Performance and targets
The aim is to encourage organisations to change their approach to strategy and their business model in order to enhance their impact on contributing to the SDGs. The disclosures aim to provide information relevant to investors and to national governments in their reports on progress against their commitment to the SDGs.
Examples of appropriate evidence to support the integration of the SDGs into business thinking are provided to encourage organisations to develop robust and credible processes and also to encourage assurance provision, which focusses on processes (not just data) by a wider range of providers.
Earlier literature on SDG reporting
The work builds on Adams’ report: ‘The Sustainable Development Goals, integrated thinking and the integrated report’ published jointly by ICAS and the IIRC. It is underpinned by an extensive review of academic and non-academic literature on the SDGs, research interviews with leading SDG reporters on their approach to the SDGs and ongoing research examining SDG disclosures. The consultation paper acknowledges input from a number of global experts.
The consultation questions concern: whether the disclosure Principles encourage transparency in relation to risks, opportunities and impacts; the recommended disclosures; means of enhancing the credibility of disclosures; and, opportunities for further aligning with existing frameworks.
How to respond
You are invited to respond to the consultation questions so that a final document can be produced, which is inclusive and responsive to input from a wide range of stakeholders. The closing date for submissions is 31st October 2019.
Enquiries can be made to aadrain@icas.com or carol.adams@durham.ac.uk
