Sustainability Disclosure Standards
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Questions and Answers

What is a primary focus of the sustainability information ecosystem?

  • Financial performance assessment
  • Employee engagement strategies
  • Product innovation cycles
  • Sustainability-related risks and opportunities (correct)

    • Which learning objective is associated with recognizing sustainability disclosure across jurisdictions?

  • Learning Objective 5 (correct)
  • Learning Objective 7
  • Learning Objective 3
  • Learning Objective 9

    • What aspect of materiality is highlighted as dynamic in nature?

  • Economic forecasting
  • Stakeholder engagement
  • Sustainability-related risks (correct)
  • Data reporting accuracy

    • What is one of the purposes of shaping new and updated standards in the sustainability information ecosystem?

    <p>To interpret compliance</p> Signup and view all the answers

    Which of the following is NOT a stated learning objective in this context?

    <p>Analyze market competition</p> Signup and view all the answers

    What does the term 'materiality' refer to in the context of sustainability information?

    <p>Relevance of sustainability-related issues</p> Signup and view all the answers

    Why is it essential to promote adoption and proper implementation of sustainability standards?

    <p>To support environmental protection efforts</p> Signup and view all the answers

    Which option best describes the relationship between sustainability-related risks and opportunities?

    <p>They can be interconnected and impact decision-making.</p> Signup and view all the answers

    What must organizations consider when making materiality judgments related to sustainability?

    <p>Unique sustainability-related risks and opportunities</p> Signup and view all the answers

    What does 'impact materiality' focus on in the context of sustainability-related financial disclosure?

    <p>The effect of sustainability issues on stakeholders</p> Signup and view all the answers

    Which concept encompasses both financial and sustainability factors in assessing materiality?

    <p>Double materiality</p> Signup and view all the answers

    In sustainability reporting, who is included in the scope of stakeholder consideration?

    <p>All individuals and groups impacted by the organization's operations</p> Signup and view all the answers

    Transition risk is primarily associated with which aspect of sustainability?

    <p>Changes in regulations or market conditions resulting from the move to a sustainable economy</p> Signup and view all the answers

    What is the main goal of establishing standards based on a common definition in sustainability reporting?

    <p>To unify the understanding and approach to sustainability disclosures across different sectors</p> Signup and view all the answers

    What is the primary focus of materiality considerations that are deemed inclusive of stakeholders?

    <p>The perspectives and interests of all relevant stakeholders</p> Signup and view all the answers

    What does the sustainability information ecosystem emphasize when reporting sustainability issues?

    <p>Holistic understanding and communication of sustainability impacts</p> Signup and view all the answers

    What is the primary role of data providers in the sustainability information ecosystem?

    <p>To collect and disseminate sustainability-related data</p> Signup and view all the answers

    Which type of data is specifically categorized under structured data in sustainability data aggregation?

    <p>Numerical metrics reported by companies</p> Signup and view all the answers

    What distinguishes ESG ratings and analytics providers from traditional data aggregators?

    <p>They evaluate companies based on environmental, social, and governance criteria.</p> Signup and view all the answers

    Which entity does NOT typically influence sustainability data quality?

    <p>Social media influencers</p> Signup and view all the answers

    What is a characteristic feature of data products shaped by customer needs?

    <p>They cater to specific preferences of consumers or organizations.</p> Signup and view all the answers

    Which of the following is NOT a function of mission-based coalitions in the sustainability information ecosystem?

    <p>Conducting independent audits of companies</p> Signup and view all the answers

    What is an important influence on the quality of sustainability data besides data aggregators?

    <p>Software providers and disclosure platforms</p> Signup and view all the answers

    What type of data aggregation focuses on providing analytical insights rather than just data collection?

    <p>ESG ratings and analytics</p> Signup and view all the answers

    Which group is specifically mentioned as a user of sustainability information?

    <p>Non-governmental organizations</p> Signup and view all the answers

    What is a key aspect of the data types referenced in sustainability information?

    <p>Different units and bases of measurement</p> Signup and view all the answers

    What is indicated as a variation in how sustainability data may be prepared?

    <p>Different methodologies for preparing data</p> Signup and view all the answers

    What type of information is emphasized as part of the sustainability reporting framework?

    <p>Forward-looking information</p> Signup and view all the answers

    What challenge is recognized in the context of sustainability disclosures?

    <p>Fragmentation leading to inconsistency</p> Signup and view all the answers

    Which of the following best represents the role of standards in sustainability disclosure?

    <p>Enhancing cohesion and uniformity</p> Signup and view all the answers

    Which objective is NOT associated with the learning goals in sustainability reporting?

    <p>ANALYZE</p> Signup and view all the answers

    Which audience is least likely to require sustainability information?

    <p>Social media influencers</p> Signup and view all the answers

    Which audience is primarily targeted by SASB standards?

    <p>Investors</p> Signup and view all the answers

    What type of framework is the TCFD considered?

    <p>Framework</p> Signup and view all the answers

    Which sustainability disclosure framework is characterized as industry-agnostic?

    <p>GRI</p> Signup and view all the answers

    What does TNFD stand for?

    <p>Taskforce on Nature-related Financial Disclosures</p> Signup and view all the answers

    Which of the following is true about the GRI Standards?

    <p>They target all stakeholders.</p> Signup and view all the answers

    How is the CDSB characterized in the context of sustainability disclosures?

    <p>Framework for investors</p> Signup and view all the answers

    Which framework is specifically aimed at emerging industries?

    <p>IIRC</p> Signup and view all the answers

    What type of agnosticism do many sustainability frameworks practice?

    <p>Industry-agnosticism</p> Signup and view all the answers

    Which of the following organizations is known for its Climate Disclosure Standards?

    <p>Climate Disclosure Standards Board</p> Signup and view all the answers

    What is a primary characteristic of industry-agnostic sustainability frameworks?

    <p>They are applicable across various industries and sectors.</p> Signup and view all the answers

    Which statement best describes the function of the Task Force on Climate-related Financial Disclosures (TCFD)?

    <p>It promotes transparency in climate-related financial risk disclosures.</p> Signup and view all the answers

    Which framework is specifically tailored to incorporate nature-related financial disclosures?

    <p>Task Force on Nature-related Financial Disclosures</p> Signup and view all the answers

    Which of the following frameworks is recognized as being inclusive of sustainability factors beyond financial performance?

    <p>Global Reporting Initiative</p> Signup and view all the answers

    What is a primary role in shaping new and updated standards within the sustainability information ecosystem?

    <p>To promote the adoption of sustainability metrics</p> Signup and view all the answers

    How does the concept of materiality in sustainability reporting differ from traditional financial materiality?

    <p>It focuses on long-term risk assessments</p> Signup and view all the answers

    Which of the following best describes the typical data preparation variations in sustainability information?

    <p>Variation driven by stakeholder needs</p> Signup and view all the answers

    What is a challenge associated with sustainability disclosures as highlighted in the context?

    <p>Diversity in reporting formats</p> Signup and view all the answers

    Which audience is primarily targeted by the Sustainability Accounting Standards Board (SASB) standards?

    <p>Publicly traded companies</p> Signup and view all the answers

    What is indicated about the role of mission-based coalitions in the sustainability information ecosystem?

    <p>They develop sector-specific sustainability practices</p> Signup and view all the answers

    What best describes the feature of data products in the sustainability information ecosystem?

    <p>Customizable based on user needs</p> Signup and view all the answers

    Which of the following is a significant factor influencing the quality of sustainability data?

    <p>Technological advancements in data collection</p> Signup and view all the answers

    What role do data aggregators play in the sustainability information ecosystem?

    <p>They offer a range of analytical insights across various data types.</p> Signup and view all the answers

    Which of the following is a characteristic of ESG ratings and analytics providers?

    <p>They offer assessments specifically tailored to investment risks.</p> Signup and view all the answers

    What is a key characteristic of impact materiality in sustainability-related financial disclosure?

    <p>It emphasizes the effects on the environment and society</p> Signup and view all the answers

    What is one of the influences on sustainability data quality mentioned in the ecosystem?

    <p>User feedback on data usefulness.</p> Signup and view all the answers

    Which concept expands the understanding of materiality by considering both financial implications and sustainability impacts?

    <p>Double materiality</p> Signup and view all the answers

    Which of the following entities plays a role in shaping sustainability standards?

    <p>Mission-based coalitions and alliances.</p> Signup and view all the answers

    Transition risk in the context of sustainability refers primarily to which of the following?

    <p>The potential changes in regulations and policies affecting sustainability</p> Signup and view all the answers

    What type of data products are shaped by customer needs?

    <p>Customized analytics that align with consumer expectations.</p> Signup and view all the answers

    Which group serves as an additional producer of sustainability data, besides traditional data providers?

    <p>Software providers developing disclosure platforms.</p> Signup and view all the answers

    Which of the following accurately describes the significance of stakeholder focus in sustainability reporting?

    <p>It necessitates understanding the diverse interests of various stakeholders</p> Signup and view all the answers

    Which statement correctly reflects the goals of establishing standards based on a common definition in sustainability?

    <p>To enhance consistency and comparability of sustainability information</p> Signup and view all the answers

    In what way do securities exchanges contribute to the sustainability information ecosystem?

    <p>They facilitate the exchange of sustainability-related financial data.</p> Signup and view all the answers

    Which of the following best describes how mission-based coalitions influence sustainability reporting?

    <p>They establish frameworks and standards that guide reporting practices.</p> Signup and view all the answers

    What role do mission-based coalitions play in the sustainability information ecosystem?

    <p>They work to create a standardized approach to sustainability metrics</p> Signup and view all the answers

    Which audience is typically excluded from requiring detailed sustainability information?

    <p>Private hobbyist investors</p> Signup and view all the answers

    The notable aspect of data providers in the sustainability information ecosystem is their ability to:

    <p>Transform data into actionable insights based on sustainability metrics</p> Signup and view all the answers

    Which sustainability disclosure framework has a primary audience of all stakeholders?

    <p>GRI</p> Signup and view all the answers

    Which of the following frameworks is categorized as a de facto standard?

    <p>CDP</p> Signup and view all the answers

    Which of the following describes the characteristics of SASB Standards?

    <p>Industry-specific standard directed towards investors</p> Signup and view all the answers

    Which sustainability framework incorporates a framework specifically for industry-agnostic use?

    <p>TCFD</p> Signup and view all the answers

    What distinguishes the CDSB in comparison to other frameworks?

    <p>It acts as a framework with supplementary industry standards</p> Signup and view all the answers

    Which standard is specifically known for being adaptable to both emerging and existing industries?

    <p>IIRC</p> Signup and view all the answers

    Which framework’s recommendations are primarily targeted at financial investors?

    <p>TCFD</p> Signup and view all the answers

    Which of these frameworks is defined as being industry-agnostic and aimed at a wide range of audiences?

    <p>CDSB</p> Signup and view all the answers

    Which among the following frameworks focuses on sustainability-related financial disclosures specifically related to climate?

    <p>Task Force on Climate-related Financial Disclosures (TCFD)</p> Signup and view all the answers

    What characteristic distinguishes industry-agnostic sustainability frameworks from industry-specific frameworks?

    <p>Applicable across various sectors without specific focus</p> Signup and view all the answers

    Which organization is tasked specifically with establishing standards related to disclosures on nature-related financial risks?

    <p>Task Force on Nature-related Financial Disclosures (TNFD)</p> Signup and view all the answers

    Which statement accurately reflects the mission of the Sustainability Accounting Standards Board (SASB)?

    <p>To develop reporting standards relevant to financial performance and sustainability</p> Signup and view all the answers

    Which of the following best describes the role of the Climate Disclosure Standards Board (CDSB)?

    <p>To integrate climate-related information into mainstream financial reports</p> Signup and view all the answers

    What aspect of sustainability information highlights the necessity for diverse methodologies in data preparation?

    <p>Different Methodologies for Preparing Data</p> Signup and view all the answers

    Which audience is least likely to utilize sustainability information when making financial decisions?

    <p>Local Government Officials</p> Signup and view all the answers

    What is indicated as a crucial element contributing to the cohesive use of sustainability frameworks?

    <p>Common Definitions and Standards</p> Signup and view all the answers

    Which of the following best describes the challenges associated with sustainability disclosures?

    <p>Lack of Reliable Data Quality</p> Signup and view all the answers

    Which aspect of sustainability information is most directly affected by the methods used in data preparation?

    <p>Forward-Looking Information</p> Signup and view all the answers

    What primary purpose do mission-based coalitions serve within the sustainability information ecosystem?

    <p>To Enhance the Integration of Standards</p> Signup and view all the answers

    How do different units and bases of measurement affect sustainability reporting?

    <p>They Complicate Data Interpretation</p> Signup and view all the answers

    What factor plays a critical role in influencing the quality of sustainability data in the ecosystem?

    <p>Data Aggregator Practices</p> Signup and view all the answers

    What aspect is included in interpretive guidance regarding sustainability disclosures?

    <p>Physical impacts of climate change</p> Signup and view all the answers

    Which regulatory framework is associated with principles-based disclosure rules?

    <p>Australian Securities and Investments Commission Regulatory Guide</p> Signup and view all the answers

    What is a characteristic feature of many sustainability frameworks?

    <p>They demonstrate a form of agnosticism</p> Signup and view all the answers

    Which of the following frameworks is specifically mentioned for its focus on nature-related financial disclosures?

    <p>Taskforce on Nature-related Financial Disclosures (TNFD)</p> Signup and view all the answers

    What is a significant challenge recognized in sustainability disclosures?

    <p>Lack of international consensus on sustainability metrics</p> Signup and view all the answers

    Which audience is least likely to require sustainability information?

    <p>Local governments funding infrastructure projects</p> Signup and view all the answers

    What type of sustainability framework is characterized as being industry-agnostic?

    <p>Global Reporting Initiative (GRI)</p> Signup and view all the answers

    What is indicated as a necessary role in shaping standards within the sustainability information ecosystem?

    <p>Collaboration among various stakeholders</p> Signup and view all the answers

    What does the term 'comply or explain' primarily refer to in the context of disclosure rules?

    <p>An obligation to either follow a regulation strictly or justify non-compliance.</p> Signup and view all the answers

    Which of the following frameworks is characterized as industry-agnostic?

    <p>Global Reporting Initiative (GRI) Standards</p> Signup and view all the answers

    What is a significant characteristic of data products shaped within the sustainability information ecosystem?

    <p>They focus on delivering insights tailored to customer requirements.</p> Signup and view all the answers

    How does Japan's Mandatory Greenhouse Gas Accounting and Reporting System primarily differentiate itself?

    <p>It enforces strict and prescriptive guidelines for emissions reporting.</p> Signup and view all the answers

    In the context of compliance and regulation, what does the EU Taxonomy primarily address?

    <p>Regulations that outline what constitutes sustainable economic activities.</p> Signup and view all the answers

    Which document emphasizes flexible mandatory line items for reporting sustainability information?

    <p>Philippines SEC Memorandum Circular No. 4</p> Signup and view all the answers

    What does the concept of materiality in sustainability reporting commonly focus on?

    <p>Both financial and sustainability factors affecting the company and stakeholders.</p> Signup and view all the answers

    Which aspect is primarily highlighted within the context of the sustainability information ecosystem?

    <p>The integration of environmental, social, and governance factors into reporting.</p> Signup and view all the answers

    Which international groups have shown support for the formation of the ISSB?

    <p>G7, G20, IOSCO</p> Signup and view all the answers

    Which country is NOT listed among those whose securities regulators support the sustainability information ecosystem?

    <p>Mexico</p> Signup and view all the answers

    Which of the following regions is included in the list of countries with supportive securities regulators?

    <p>European Union</p> Signup and view all the answers

    What is a significant aspect to consider when evaluating the current state of corporate reporting?

    <p>Policy and economic environment</p> Signup and view all the answers

    Which country listed is known for its notable support in the sustainability information ecosystem?

    <p>Brazil</p> Signup and view all the answers

    Which of the following organizations is NOT mentioned as a supportive entity for sustainability information regulations?

    <p>International Organization for Standardization (ISO)</p> Signup and view all the answers

    In the context of the sustainability information ecosystem, which social context is highlighted?

    <p>United States</p> Signup and view all the answers

    Which element is NOT a factor influencing the current state of corporate reporting in sustainability?

    <p>Geopolitical stability</p> Signup and view all the answers

    Study Notes

    Sustainability Disclosure Across Jurisdictions

    • The Sustainability Disclosure across jurisdictions chapter discusses the importance of shaping new and updated standards, promoting adoption, and interpreting compliance.
    • Materiality judgements are applied when discussing sustainability-related financial disclosure.
    • Sustainability-related risks and opportunities are considered in materiality assessment.
    • Transition risk is one of the key risks to consider.

    Standards Built on a Common Definition

    • Standards are built on a common definition.
    • Impact materiality is emphasized in sustainability-related financial disclosure.

    Inclusive of Stakeholders

    • Sustainability-related financial disclosure aims to be inclusive of all stakeholders.
    • This includes assessing the impact of a company's activities on stakeholders including shareholders, customers, suppliers, employees, communities, and the environment.

    The Sustainability Information Value Chain and the Role of Data Providers

    • The sustainability information value chain involves data providers, aggregators, ESG ratings and analytics providers, and data users.
    • Data aggregators collect and analyze data from various sources, including both structured and unstructured data.
    • ESG ratings and analytics providers evaluate companies based on environmental, social, and governance factors, providing insights to investors.

    Data Products Shaped by Customer Needs

    • The demand for sustainability data has driven the development of various data products.

    Additional Influencers of Sustainability Data Quality

    • Disclosure platforms and reporting software play a significant role by facilitating sustainability reporting processes.
    • Securities exchanges, mission-based coalitions and alliances, and industry associations contribute to shaping sustainability data quality.

    Different Audience Needs

    • The sustainability information value chain caters to different audience needs, including investors, customers, regulators, and employees.

    A Broad Range of Data Types

    • Sustainability data encompasses various units and bases of measurement to capture diverse aspects.
    • Different methodologies are used for preparing sustainability data, ensuring transparency and comparability.
    • Forward-looking information, including targets and aspirations, is increasingly included in sustainability disclosures.

    The Role of Standards and Frameworks: From Fragmentation to Cohesion in Sustainability Disclosure

    • The chapter explores various sustainability disclosure frameworks and standards, including CDP, CDSB, GRI, IIRC, SASB, TCFD, and TNFD.
    • While these frameworks provide guidance, they lack alignment, leading to confusion and complexity.
    • Growing rates of adoption of different frameworks often lead to confusion regarding reporting requirements.

    Comparing Sustainability Disclosure Frameworks and Standards Pre-ISSB Consolidation

    • The table outlines the target audiences, nature of frameworks/standards, and industry focus of each sustainability disclosure framework.
    • CDP: Focuses on environmental disclosures, targeting all stakeholders.
    • CDSB: Focuses on providing information relevant to investors.
    • GRI: Aims to provide comprehensive sustainability disclosures to stakeholders.
    • IIRC: Emphasizes the integration of sustainability into corporate reporting.
    • SASB: Focuses on industry-specific sustainability disclosures for investors.
    • TCFD: Provides recommendations for disclosing climate-related financial information.
    • TNFD: Provides a framework for reporting nature-related risks and opportunities.

    Sustainability Disclosure Across Jurisdictions

    • The IFRS Foundation is shaping new and updated standards to promote adoption and proper implementation of sustainability-related financial disclosures.
    • They interpret compliance with sustainability disclosure requirements across jurisdictions.
    • Materiality judgments are applied in the context of sustainability-related financial disclosures to determine if information is significant enough to influence the decisions of users of financial statements.
    • Identifying sustainability-related risks and opportunities involve considering:
      • Climate change: This includes physical risks like extreme weather events and transition risks related to policies and regulations aimed at reducing greenhouse gas emissions.
      • Resource scarcity: This involves the depletion of natural resources and the potential impact on businesses.
      • Social issues: This encompasses factors like human rights, labor practices, corruption, and supply chain risks.

    Standards Built on a Common Definition

    • Sustainability-related financial disclosure standards are built on a shared definition of materiality, which considers the information’s potential impact on the ability of a company to achieve its strategic objectives.

    Impact-Focused Materiality

    • The concept of impact materiality is applied to sustainability-related financial disclosures, meaning that companies should consider not only the financial impact of sustainability issues on their businesses but also their impact on society and the environment.

    Inclusive of Stakeholders

    • Stakeholder engagement is an integral part of sustainability-related financial disclosures, as companies are expected to consider the interests of a wide range of stakeholders, including investors, employees, customers, suppliers, communities, and the environment.

    Stakeholder and Investor Focused

    • Sustainability-related disclosures are increasingly focused on the needs of stakeholders, especially investors, who seek information about a company's environmental, social, and governance (ESG) performance.
    • Frameworks like GRI and the TCFD are designed to facilitate the disclosure of ESG-related information in a way that is relevant to investors.

    The Sustainability Information Value Chain

    • The Sustainability information value chain encompasses a range of stakeholders, starting with data providers who collect and analyze sustainability-related information.
    • This information is then used by ESG ratings and analytics providers to assess the ESG performance of companies.
    • Data products are shaped to meet the needs of customers who use them to make informed investment and business decisions.

    Data Providers

    • Data providers fall into several categories:
      • Data aggregators: They collect data from various sources and provide it to data users in structured and unstructured formats.
      • ESG ratings and analytics providers: They analyze and interpret sustainability data to assess the ESG performance of companies.
      • Additional producers: This group includes:
        • Disclosure platforms and reporting software providers
        • Securities exchanges (facilitating ESG disclosures)
        • Mission-based coalitions and alliances
        • Industry associations

    Sustainability Disclosure Frameworks and Standards

    • Numerous frameworks and standards guide sustainability disclosures:
      • Global Reporting Initiative (GRI)
      • CDP
      • Climate Disclosure Standards Board (CDSB)
      • International Integrated Reporting Council (IIRC)
      • Sustainability Accounting Standards Board (SASB)
      • Task Force on Climate-related Financial Disclosures (TCFD)
      • Task Force on Nature-related Financial Disclosures (TNFD)

    Framework vs. Standards

    • The GRI, IIRC, SASB, TCFD, and TNFD frameworks provide guidance on sustainability disclosures.
    • CDP and CDSB are considered de facto standards, meaning they are widely accepted as best practices.
    • Frameworks and standards can be categorized as either industry-agnostic or industry-specific.

    Increasing Adoption Rates

    • These frameworks and standards are increasingly adopted by companies, although confusion exists due to the proliferation of different approaches.
    • This presents a challenge for investors who need consistent and comparable sustainability information from various companies.

    The Sustainability Information Value Chain

    • The sustainability information value chain is composed of various stakeholders that contribute to the production, aggregation, and dissemination of information about companies’ sustainability performance.
    • These stakeholders play different roles in the value chain:
      • Data providers: collect and analyze sustainability-related information, including reporting platforms.
      • Data aggregators: gather and organize information from various data providers.
      • ESG ratings and analytics providers: analyze and interpret sustainability data to calculate ESG scores and ratings.
      • Users of sustainability information: make decisions based on ESG information, from investors to business leaders.

    Key Influencers of Sustainability Data Quality

    • Disclosure platforms and reporting software providers: These companies develop platforms and software that companies use to collect, manage, and report sustainability data.
    • Securities exchanges: They set requirements for companies listed on their exchanges related to sustainability disclosures.
    • Mission-based coalitions and alliances: They bring together stakeholders from various sectors to develop best practices and standards for sustainability reporting.
    • Industry associations: They represent specific industries and can work to develop sector-specific standards for sustainability reporting.

    A Closer Look: Double Materiality

    • Double materiality refers to the idea that companies should consider both the impact their operations have on the environment and society (outward materiality) and the impact of environmental and social factors on their business (inward materiality).
    • Sustainability-related risks and opportunities are not technically material because they don't directly impact the entity's financial statements.
    • However, these risks and opportunities could have a significant impact on the entity's future profitability and financial performance.
    • They can impact entities through potential changes in laws, regulations, and consumer demand.
    • Companies must consider sustainability-related risks and opportunities, even if they don’t technically affect the financial statements, because they can impact their overall business operations.

    The Dynamic Nature of Materiality

    • Materiality is dynamic, meaning that it can change over time as stakeholder priorities evolve and new information emerges.
    • This includes the possibility of new regulations and the increased emphasis on specific sustainability considerations.
    • Companies should regularly review their materiality assessments to ensure they are reflecting up-to-date information and stakeholder expectations.

    Additional Users of Sustainability Information

    • Non-governmental organizations (NGOs) are users
    • Sell-side analysts are users

    Different Audience Needs

    • Sustainability information meets different needs of different users

    Data Types

    • Various data types are used in the sustainability information ecosystem
    • Different units and bases of measurement are common
    • Different methodologies can be used to prepare data
    • Forward-looking information is used

    The Global Reporting Initiative (GRI)

    • The GRI is a global standard-setting body for sustainability reporting

    The CDP

    • Formerly known as the Carbon Disclosure Project
    • The CDP is a global non-profit that drives environmental disclosure

    The Climate Disclosure Standards Board (CDSB)

    • Works to integrate climate-related information into mainstream financial reporting

    The International Integrated Reporting Council (IIRC)

    • Works to develop a framework for integrated reporting

    The Sustainability Accounting Standards Board (SASB)

    • Develops industry-specific sustainability accounting standards
    • Established by the Financial Stability Board
    • Focuses on climate-related financial disclosures
    • Focuses on nature-related financial disclosures

    Industry-Agnostic vs Industry-Specific

    • Industry-agnostic standards are generic standards that apply to multiple industries

    Intergovernmental Regulatory Representatives for ISSB

    • The G7 group of nations supports the formation of the ISSB
    • The G20 group of nations supports the formation of the ISSB
    • The International Organization of Securities Commissions (IOSCO) supports the formation of the ISSB
    • The Financial Stability Board (FSB) supports the formation of the ISSB
    • The African Finance Ministers support the formation of the ISSB

    Securities Regulators

    • Many of the world's securities regulators support the formation of the ISSB
    • These include regulators from Australia, Brazil, Canada, China, European Union, France, Germany, Hong Kong, India, Japan, South Africa, Korea, Switzerland, United Kingdom, and the United States

    Voluntary to Mandatory Climate Disclosure

    • Canada, the European Union, and the United States are examples of different approaches to mandatory climate disclosure

    Voluntary to Mandatory Climate Disclosure in Canada

    • Canada has a voluntary approach to climate disclosure

    Voluntary to Mandatory Climate Disclosure in the European Union

    • The European Union has a mandatory approach to climate disclosure

    Voluntary to Mandatory Climate Disclosure in the United States

    • The United States has a voluntary approach to climate disclosure

    Interpretive Guidance

    • Interpretive guidance in sustainability reporting provides examples of appropriate disclosures

    Principles-Based Disclosure Rules

    • Principles-based rules provide principles that must be followed in disclosure
    • The Australian Securities and Investments Commission (ASIC) is an example of a regulator with principles-based disclosure rules

    'Comply or Explain'

    • 'Comply or Explain' rules require entities either to comply with specific requirements or to explain why they have not

    Mandatory Line Items

    • Mandatory line items require specific information to be disclosed

    Mandatory Line Items Examples

    • EU Taxonomy for Sustainable Economic Activities- Requires disclosures on a company's activities
    • Japan’s Mandatory Greenhouse Gas Accounting and Reporting System- Requires disclosures on greenhouse gas emissions
    • Japan’s Ministry of Economy, Trade and Industry (METI) Practical Guidelines for Corporate Governance Systems (CGS)- Requires disclosures on corporate governance
    • King IV Report on Corporate Governance for South Africa, 2016- Includes sustainability reporting principles for South African entities

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    FSA Credential Level I Study Guide Part II - Sustainability Information Ecosystem PDF

    Description

    This quiz explores the essential concepts of sustainability disclosure across different jurisdictions. It addresses materiality considerations specific to sustainability-related financial reporting, the identification of associated risks, and the importance of inclusive stakeholder assessments. Test your knowledge on how these standards are shaped and applied!

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