The Sustainability Accounting Standards Board (SASB) and the Global Reporting Initiative (GRI) will work together to provide guidance to companies about how to implement both of their ESG reporting standards concurrently.
Some issuers have complained of an ESG reporting alphabet soup as they’ve tried to come to terms with the differences between SASB, GRI, the Task Force on Climate-related Financial Disclosures (TCFD) and other organizations.
The new partnership between SASB and GRI aims to provide companies with examples about how their standards can be used together, according to a press release. Guidance will be provided later this year.
The collaboration aims to help with implementation of the two sets of standards, but will not influence the nature of the standards themselves. In both cases, the standards are developed and maintained by independent bodies – the Global Sustainability Standards Board for GRI, and the SASB Standards Board.
SASB’s standards are industry-specific and offer companies a list of recommended sustainability-related risks and opportunities that investors are likely to view as material. The GRI standards focus on the economic, environmental and social impacts of a company and its contributions toward sustainable development. The recommendations are based on relevance to all stakeholders, rather than just investors, and are therefore not always based around financial materiality. Often, issues identified by GRI become financially material over time.
Janine Guillot, CEO of SASB, says Covid-19 has demonstrated the importance of reporting on ESG topics. ‘The pandemic has demonstrated that so-called non-financial information can indeed highlight material financial implications,’ she says in the press release.
Tim Mohin, CEO of GRI, adds that ‘investors, policy makers, civil society and other stakeholders are demanding improved disclosure of information on sustainability impacts, including those likely to drive risk and opportunity in both the short and long term.’
Spokespeople for both SASB and GRI confirm that this collaboration has no bearing on the organizations’ involvement with the Corporate Reporting Dialogue (CRD).
The CRD launched in November 2018 with the goal of creating a more harmonious ESG reporting ecosystem. Participants include SASB, GRI, TCFD, the Climate Disclosure Standards Boards, the Carbon Disclosure Project, the Financial Accounting Standards Board, the International Accounting Standards Board, the International Organization for Standardization and the Institute of Integrated Reporting.
Ian Mackintosh, chair of the CRD, wrote in a blog post this April that the participants in the CRD will continue their individual commitments to linking financial and non-financial information, but that ‘the CRD will not take a lead role.’