Sustainability Reporting Standards and Frameworks PDF

CHAPTER 3 SUSTAINABILITY REPORTING STANDARDS AND FRAMEWORKS LEARNING OBJECTIVES Upon completion of this chapter, you should be able to 1. Understand the role of sustainability reporting standards and frameworks. 2. Understand the nature and development of the global reporting...

CHAPTER 3 SUSTAINABILITY REPORTING STANDARDS AND FRAMEWORKS LEARNING OBJECTIVES Upon completion of this chapter, you should be able to 1. Understand the role of sustainability reporting standards and frameworks. 2. Understand the nature and development of the global reporting initiative (GRI) standard. 3. Explain the importance of the Global Reporting Initiative (GRI) standard. 4. Understand the nature and development of the International Integrated Reporting Framework. 5. Explain the importance of the International Integrated Reporting Framework. 6. Understand the nature and development of the Sustainability Accounting Standards. 7. Explain the importance of the Sustainability Accounting Standards. 8. Understand the nature and development of the Task Force On Climate-Related Financial Disclosures (TCFD) 9. Explain the importance of the Task Force On Climate-Related Financial Disclosures (TCFD). One of the big drivers to the development of sustainability reporting and key to its institutionalization has been the myriad of guidance standards and frameworks for this form of reporting. As the significance of sustainability information has risen, and reporting has become a standard practice of many corporations, there has also been increasing interest in standardizing the practice. Standards and frameworks are often advertised as an opportunity to get more regularity, consistency, and comparability into the voluntary disclosures, but also with the claim to enhance the materiality of the disclosures. This implies that the standards and frameworks help organizations focus on the more important and relevant matters while leaving the less important issues with limited or no attention. In the remainder of this section, we outline several guidance standards and frameworks. As it is not possible to cover all possible standards and frameworks, we have chosen to discuss four in some detail the Global Reporting Initiative's (GRI) Sustainability Reporting Standards, the International Integrated Reporting Council's (IIRC) Integrated Reporting (IR) Framework, the Sustainability Accounting Standards Board's (SASB) Sustainability Accounting Standards, and the recommendations of the Task Force on Climate-related Financial Disclosure (TCFD). These represents the most well-known global standards and frameworks at the time of writing that will enable us to consider a variety of practices. We then briefly identify several other key standards and frameworks that exist, or are developing, internationally and have varying levels of influence within both local and global contexts. Framework Standards A framework is principles-based A set of standards are specific, guidance for how information can be replicable and detailed requirements structured and prepared, and what for what should be reported for each broad topics should be covered. topic. They are rules-based requirement GLOBAL REPORTING INITIATIVE (GRI) The GRI Standards has a comprehensive reporting requirement covering governance, economic, environmental, and social topics. It is also aligned with international standards and normative frameworks such as the United Nations Global Compact (UNGC) and the International Labour Organization (ILO) Tripartite Declaration. Background The Global Reporting Initiative (GRI) is an independent international organization that provides the most widely used standards for sustainability reporting. The GRI was founded in 1997 following public outcry over the environmental damage of the Exxon Valdez oil spill. The first version of what then the GRI Guidelines was published in 2000 - providing the first global framework for sustainability reporting. In 2016, the GRI transitioned from providing guidelines to setting the first global standards for sustainability reporting, developed by the Global Sustainability Standards Board (GSSB), an independent operating body under the auspices of the GRI. The GRI also assists organizations on their sustainability reporting journey. What Are The GRI Standards? The GRI standards consist of Universal Standards and Topic Specific Standards. Each of the standards not only provides requirements, which are mandatory instructions, but also recommendations. They include where a course of action is encouraged but not required and guidance, which includes background information, explanations and examples to help organizations better understand the requirements. Universal Standards (100 Series) The 100 Series includes three Universal Standards: 1. GRI 101: Foundation - is the starting point for using the set of GRI Standards. GRI 101 sets out the Reporting Principles for defining report content and quality. It includes requirements for preparing a sustainability report in accordance with the GRI Standards and describes how the GRI Standards can be used and referenced. GRI 101 also includes the specific claims that are required for organizations preparing a sustainability report in accordance with the Standards, and for those using selected GRI Standards to report specific information. 2. GRI 102: General Disclosures - is used to report contextual information about an organization and its sustainability reporting practices. This includes information about an organization's profile, strategy, ethics and integrity, governance, stakeholder engagement practices, and reporting process. 3. GRI 103: Management Approach is used to report information about how an organization manages a material topic. It is designed to be used for each material topic in a sustainability report, including those covered by the topic specific GRI Standards (Series 200, 300, and 400) and other material topics. Applying GRI 103 with each material topic allows the organization to provide a narrative explanation of why the topic is material, where the impacts occur (the topic Boundary), and how the organization manages the impacts. Topic Specific Standards (200, 300 and 400 Series) The 200 (Economic topics), 300 (Environmental topics), and 400 (Social topis) series include numerous Topic Specific Standards. These are used to report information on an organization's impacts related to economic, environmental, and social topics (e.g., Economic Performance, Materials, or Employment). To prepare a sustainability report in accordance with the GRI Standards, an organization applies the Reporting Principles for defining report content from GRI 101: Foundation to identify its material economic, environmental, and/or social topics. These material topics determine which topic-specific Standards the organization uses to prepare its sustainability report. Selected Topic Specific Standards, or parts of their content, can also be used to report specific information, without preparing a sustainability report. EXHIBIT 3.1 Topic Specific Standards 300 200 400 Series: Series: Economic Series: Social Environmental 201- Economic 301 - Materials 401 - Employment performance 302 - Energy 402 - Labor management 202- Market presence 303 - Water relations 203- Indirect 304 - Water and effluents 403 - Occupational health economic impacts 305 - Biodiversity and safety 204- Procurement 306 - Emissions 404 - Training and practices 307 - Waste education 205- Anti-corruption 308 - Environmental 405 - Diversity and equal 206- Anti-competitive compliance opportunity behavior 309 - Supplier 406 - Non-discrimination 207- Tax environmental 407 - Freedom of assessment. association 408 - Child labor 409 - Forced or compulsory labor 410 - Security practices 411 - Rights of indigenous peoples 412 - Human rights 413- Local communities 414 - Supplier social assessment 415 - Public policy 416 -Customer health and safety 417 - Marketing and labeling 418 - Training and education 419 - Socioeconomic compliance How Are The GRI Standards Developed? Companies may use the GRI standards to prepare a sustainability report, or they may use selected standards to report specific information. There are two options for preparing a report in accordance with the GRI Standards: Core and Comprehensive. 1. Core: This option indicates that a report contains the minimum information needed to understand the nature of the organization, its material topics and related impacts, and how these are managed. 2. Comprehensive: This builds on the Core option by requiring additional disclosures on the organization's strategy, ethics and integrity, and governance. In addition, the organization is required to report more extensively on its impacts by reporting all the topic-specific disclosures for each material topic covered by the GRI Standards. These options do not relate to the quality of the information in the report or the magnitude of the organization's impacts. Instead, they reflect the degree to which the GRI Standards have been applied. An organization is not required to progress from Core to Comprehensive; it can choose the option that best meets its reporting needs, and the information needs of its stakeholders. Section 3 of GRI 101: Foundation outlines the requirements for making claims related to using the GRI standards and requirements related to reasons for the omission  of any disclosures. Section 3 also specifies that reporting organizations notify GRI of the use of their standards and the claims made concerning that use. To claim that a sustainability report has been prepared in accordance with the GRI Standards, the reporting organization shall meet all criteria for the respective option (Core or Comprehensive) from Exhibit 3.2: EXHIBIT 3.2 Criteria to Claim a Report Has Been Prepared In Accordance With The GRI Standards Required Criteria Core Option Comprehensive Option Use the correct Include the claim (statement following statement: of use) in any Include the following statement: "This report has been published "This report has been prepared in prepared in materials with accordance with the GRI accordance with the disclosures based Standards: Core option" GRI Standards: on the GRI Comprehensive option" Standards Use GRI 101: Foundation to Comply with all requirements in follow the basic Section 2 of GRI 101: process for Foundation ('Using the GRI [Same as for Core] preparing a Standards for sustainability sustainability reporting') report Comply with all Comply with all reporting reporting requirements requirements for the for all disclosures from following disclosures from GRI GRI 102: General 102: General Disclosures: Disclosures. Use GRI 102: Reasons for omission General Disclosures 102-1 to 102- 13 are only Disclosures (Organizational profile) permitted for the to report Disclosure 102-14 (Strategy) following disclosures: contextual Disclosure 102-16 (Ethics and information about integrity) Disclosure 102-17 the organization Disclosure 102-18 (Governance) (Ethics and integrity), and Disclosures 102-40 to 102-44 Disclosures 102-19 to (Stakeholder engagement) 102- 39 (Governance). Disclosures 102-45 to 102-56 (Reporting practice) See clause 3.2 for more information. Use GRI 103: Management For each material topic, Approach to comply with all reporting report the requirements from GRI 103: management Management Approach. [Same as for Core] approach and the Reasons for omission are only topic Boundary permitted for Disclosures 103-2 for all material and 103- 3 (see clause 3.2). topics  For each material topic covered by a topic For each material topic specific GRI Standard: covered by a topic specific comply with all GRI Standard: reporting requirements Comply with all reporting in the 'Management requirements in the approach disclosures' 'Management approach section. disclosures' section. Comply with all Use the topic Comply with all reporting reporting requirements specific GRI requirements for at least in the 'Management Standards (series one topic-specific disclosure. approach disclosures'. 200, 300, 400) to For each material topic not For each material topic report on covered by a GRI Standard, it not covered by a GRI material topics is recommended to report Standard, it is other appropriate disclosures recommended to report for that topic (see clause other appropriate 2.5.3). disclosures for that Reasons for omission are topic (see clause 2.5.3). permitted for all topic- Reasons for omission specific disclosures (see are permitted for all clause 3.2). topic- specific disclosures (see clause 3.2). Ensure that reasons for Comply with all requirements in omission are clause 3.2 (Reasons for [Same as for Core] used correctly, if omission) applicable Notify GRI of the Comply with all requirements in use of the clause 3.4 (Notifying GRI of the [Same as for Core] Standards use of the Standards) If, in exceptional cases, an organization preparing a sustainability report in accordance with the GRI Standards cannot report a required disclosure, the organization shall provide in the report a reason for omission that: a. describes the specific information that has been omitted; and b. specifies one of the following reasons for omission from Exhibit 3.3, including the required explanation for that reason. EXHIBIT 3. 3 Reasons for Omission Reasons for Omission Required Explanation in the Sustainability Report Specify the reason(s) why the disclosure is not Not applicable applicable Describe the specific confidentiality constraints Confidentiality constraints prohibiting the disclosure. Specific legal prohibitions Describe the specific legal prohibitions. Describe the specific steps being taken to obtain the information and the expected timeframe for doing so. Information unavailable If the reason for omission is because the necessary information cannot be obtained or is not  of adequate quality to report (as may sometimes be the case when the Boundary for a material topic extends beyond the reporting organization), explain this situation. GRI 101: Foundation also includes 10 Reporting Principles for defining an organization's reporting content and quality. Principles 1 to 4 relate to content (Exhibit 3.4), and Principles 6 to 10 focus on quality (Exhibit 3.5). These principles help an organization understand what to include in a report and realize the expectations of its stakeholders. EXHIBIT 3.4 Reporting Principles for Defining Report Contents 1.1 The reporting organization shall identify its stakeholders Stakeholder and explain how it has responded to their reasonable Inclusiveness expectations and interests. 1.2 The report shall present the reporting Sustainability organization's Context performance in the wider context of sustainability. 1.3 The report shall cover topics that: 1.3.1 reflect the reporting organization's significant economic, Materiality environmental, and social impacts; or 1. 3. 2 substantively influence the assessments and decisions of stakeholders. 1.4 The report shall include coverage of material topics and their Boundaries, sufficient to reflect significant Completeness economic, environmental, and social impacts, and to enable stakeholders to assess the reporting organization's performance in the reporting period. EXHIBIT 3.5 Reporting Principles for Defining Report Quality 1.5 The reported information shall be sufficiently accurate Accuracy and detailed for stakeholders to assess the reporting organization's performance. 1.6 The reported information shall reflect positive and Balance negative aspects of the reporting organization's performance to enable a reasoned assessment of overall performance. 1.7 The reporting organization shall make information available Clarity in a manner that is understandable and accessible to stakeholders using that information. 1.8 The reporting organization shall select, compile, and report information consistently. The reported information shall be presented in a manner that enables stakeholders to Comparability analyze changes in the organization's performance over time, and that could support analysis relative to other organizations. 1.9 The reporting organization shall gather, record, compile, analyze, and report information and processes used in the Reliability preparation of the report in a way that they can be subject to examination, and that establishes the quality and materiality of the information. 1.10 The reporting organization shall report on a regular Timeliness schedule so that information is available in time for stakeholders to make informed decisions Why Are The GRI Standards Needed? The GRI standards encompass a wide range of sustainability topics geared to meet the needs of a broad and diverse group of stakeholders. Citing the 1987 World Commission on Environment and Development aspirational goal for sustainable development - 'development which meets the needs of the present without compromising the ability of future generations to meet their own needs'. GRI states that its raison d'etre is, "to help organizations be transparent and take responsibility for their impacts so that we can create a sustainable future. To that end, sustainability reporting using GRI standards creates the opportunity for an organization to identify its impacts on the economy, the environment, and/or society, and disclose those impacts publicly in a common language that lends itself to greater comparability, quality, transparency and accountability. This reporting enables stakeholders, both internal and external, to make informed decisions about the organization's contributions - both positive and negative, to the goal of sustainable development. INTERNATIONAL INTEGRATED REPORTING FRAMEWORK The Framework defines six capitals, seven guiding principles, and eight content elements of an integrated report but does not specify topic disclosures and measurement methods. It aims to monitor how the capitals are used and created by the business model and discloses the companies' strategies in light of risks and outlook. Background The International Integrated Reporting Council (IIRC), launched in 2010, is a collaboration between Accounting For Sustainability (A4S), the Global Reporting Initiative (GRI) and the International Federation of Accountants (IFAC). It was set up as a global coalition of regulators, investors, companies, standard setters, the accounting profession and NGOs. The coalition promotes communication about value creation, preservation and erosion as the next step in the evolution of corporate reporting. The International Integrated Reporting Framework was launched in December 2013, and a revised edition launched in January 2021. The latest version applies to reporting periods commencing 1 January 2022. In November 2020, the International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB) announced their intention to merge into a combined organization, The Value Reporting Foundation. What is an Integrated Report? An integrated report is a concise communication about how an organization's strategy, governance, performance and prospects, in the context of its external environment, lead to the creation, preservation or erosion of value in the short, medium and long term. The Six Capitals Defined as "stocks of value on which all organizations depend for their success as inputs to their business model, and which are increased, decreased or transformed through the organization's business activities and outputs". The capitals are categorized in the Framework as financial, manufactured, intellectual, human, social and relationship, and natural. 1. Financial capital: The pool of funds that is available to an organization for use in the production of goods or the provision of services and obtained through financing (e.g., debt, equity or grants) or generated through operations or investments.  2. Manufactured capital: Manufactured physical objects (as distinct from natural physical objects) that are available to an organization for use in the production of goods or the provision of services - buildings, equipment, infrastructure (e.g., roads, ports, bridges, and waste and water treatment plants). Manufactured capital is often created by other organizations, but includes assets manufactured by the reporting organization for sale or when they are retained for its own use. 3. Intellectual capital: Organizational, knowledge-based intangibles, including intellectual property (e.g., patents, copyrights, software, rights and licenses) and "organizational" capital (e.g., tacit knowledge, systems, procedures and protocols). 4. Human capital: Competencies, capabilities, experience, and motivations of people to innovate, including their: (a) alignment with and support for an organization's governance framework, risk management approach, and ethical values; (b) ability to understand, develop and implement an organization's strategy; and (c) loyalties and motivations for improving processes, goods and services, including their ability to lead, manage and collaborate. 5. Social and relationship capital: The institutions and the relationships within and between communities, groups of stakeholders and other networks, and the ability to share information to enhance individual and collective well-being. Social and relationship capital includes: (a) shared norms, and common values and behaviors; (b) key stakeholder relationships, and the trust and willingness to engage that an organization has developed and strives to build and protect with external stakeholders; (c) intangibles associated with the brand and reputation that an organization has developed; and (d) an organization's social license to operate. 6. Natural capital: All renewable and non-renewable environmental resources and processes that provide goods or services that support the past, current or future prosperity of an organization, including air, water, land, minerals, forests, along with biodiversity and eco-system health. While most organizations likely have some interaction with each of the capitals to some extent, not all capitals are materially significant for every organization. They are provided as part of the framework as underpinning to the concept of value creation, preservation, or erosion guideline to ensure that organizations consider all forms of capital that they use or affect. How Is The Framework Developed? Guiding Principles Seven Guiding Principles underpin the preparation and presentation of an integrated report, informing the content of the report and how information is presented: 1. Strategic focus and future orientation. An integrated report should provide insight into the organization's strategy, and how it relates to the organization's ability to create value in the short, medium and long term, and to its use of and effects on the capitals. 2. Connectivity of information. An integrated report should show a holistic picture of the combination, interrelatedness and dependencies between the factors that affect the organization's ability to create value overtime. 3. Stakeholder relationships. An integrated report should provide insight into the nature and quality of the organization's relationships with its key stakeholders, including how and to what extent the organization understands, takes into account and responds to their legitimate needs and interests. 4. Materiality. An integrated report should disclose information about matters that substantively affect the organization's ability to create value over the short, medium and long term. 5. Conciseness. An integrated report should be concise. 6. Reliability and completeness. An integrated report should include all material matters, both positive and negative, in a balanced way and without material error. 7. Consistency and comparability. The information in an integrated report should be presented: (a) on a basis that is consistent over time; and (b) in a way that enables comparison with other organizations to the extent it is material to the organization's own ability to create value overtime. Key to the principles of the framework is providing insight into the organization strategy, its ability to create value and its use of the capitals, as described above. An integrated report should also provide a holistic view of the connectivity, interrelatedness and dependencies of the capitals and stakeholder relationships. Disclosures should present information about all matters that are material to the organization's ability to create value over time, in conformity with the principles of conciseness, reliability and completeness, and consistency and comparability. Content Elements The framework also identifies eight Content Elements (i.e., categories of information required to be included in an integrated report) that are fundamentally linked to each other and are not mutually exclusive. These Content Elements are stated in the form of questions to be answered in a way that makes the relationships between them apparent. 1. Organizational overview and external environment: What does the organization do and what are the circumstances under which it operates? 2. Governance: How does the organization's governance structure support its ability to create value in the short, medium and long term? 3. Business model: What is the organization's business model? 4. Risks and opportunities: What are the specific risks and opportunities that affect the organization's ability to create value over the short, medium and long term, and how is the organization dealing with them? 5. Strategy and resource allocation: Where does the organization want to go and how does it intend to get there? 6. Performance: To what extent has the organization achieved its strategic objectives for the period and what are its outcomes in terms of effects on the capitals? 7. Outlook: What challenges and uncertainties is the organization likely to encounter in pursuing its strategy, and what are the potential implications for its business model and future performance? 8. Basis of preparation and presentation: How does the organization determine what matters to include in the integrated report and how are such matters quantified or evaluated? Why is the Framework Needed? The Framework is principles-based with the intent to strike an appropriate balance between flexibility and prescription that recognizes the wide variation in individual circumstances of different organizations while enabling a sufficient degree of comparability across organizations to meet relevant information needs. Integrated reporting aims to: Improve the quality of information available to providers of financial capital to enable a more efficient and productive allocation of capital.  Promote a more cohesive and efficient approach to corporate reporting that draws on different reporting strands and communicates the full range of factors that materially affect the ability of an organization to create value overtime. Enhance accountability and stewardship for the broad base of capitals (financial, manufactured, intellectual, human, social and relationship, and natural) and promote understanding of their interdependencies. Support integrated thinking, decision-making and actions that focus on the creation of value over the short, medium and long term. With this focus on value creation, Integrated reporting embraces the notion of integrated thinking, which considers the connectivity and interdependencies between the various operating and functional units of the business, along with the full range of organizational resources, or "capitals" that contribute to creating value. Integrated thinking encompasses the enterprise's business model, its strategy and the risks it faces in achieving strategic objectives. It also considers the capacity of the organization to respond to its external environment and address legitimate key stakeholder needs. Value Creation, Preservation or Erosion For The Organization And For Others Value created, preserved or eroded by an organization over time manifests itself in increases, decreases or transformations of the capitals caused by the organization's business activities and outputs. That value has two interrelated aspects - value created, preserved or eroded for: (a) the organization itself, which affects financial returns to the providers of financial capital; and (b) others (i.e., stakeholders and society at large). The ability of an organization to create value for itself is linked to the value it creates for others. As illustrated in Exhibit 3.6, this happens through a wide range of activities, interactions and relationships in addition to those, such as sales to customers, that are directly associated with changes in financial capital. These include, for example, the effects of the organization's business activities and outputs on customer satisfaction, suppliers' willingness to trade with the organization and the terms and conditions upon which they do so, the initiatives that business partners agree to undertake with the organization, the organization's reputation, conditions imposed on the organization's social license to operate, and the imposition of supply chain conditions or legal requirements. EXHIBIT 3.6 VALUE CREATED, PRESERVED OR ERODED FOR THE ORGANIZATION AND FOR OTHERS ACTIVITIES A fundamental concept of Integrated Reporting is that an organization not only creates value not only for itself but for others. The activities of an organization affect not only the well-being of customers, suppliers, employees, owners and investors, but also a potentially broad range of other stakeholders and society-at-large. Accordingly, how an organization carries out these activities also determines any conditions imposed on the organization's social license to operate. SUSTAINABILITY ACCOUNTING STANDARDS BOARD (SASB) The SASB Standards provides industry-based sustainability standards for more than 77 specific industries. It has five general sustainability themes including environment, social capital, human capital, business model and innovation, and leadership and governance. To address sustainability issues, a minimum set of topics for consideration in each industry are also provided, together with quantitative and comparable accounting metrics. Background The Sustainability Accounting Standards Board (SASB), based in the United States, was established in 2011 with the original intent of providing standards for the U.S. capital markets. The majority (55%) of companies using the standards are within the United States. However, the reach of the SASB is increasingly global, and its mission is, 'to help businesses around the world identify, manage and report on sustainability topics that matter most to their investors', with a focus on what is financially material. The standards were launched in 2018. There are two main users of the SASB standards: Corporations that want to disclose financially material, decision-useful information to their investors. Investors looking for financially material, comparable, non-financial information and metrics across an industry. What Are The SASB Standards? These are industry-specific standards that are used to identify financially material sustainability issues. They intend to provide investors with comparable, non-financial information and metrics across an industry. Since not all sustainability issues matter equally to each industry and the same sustainability issue can manifest differently across industries, SASB has developed Standards for 77 industries that identify the subset of environmental, social, and governance issues most relevant to financial performance in each industry. Industry- specific disclosure reduces costs and minimizes noise by surfacing the most relevant information. EXHIBIT 3.7 Sustainability Industry Classification System (see internet) The SASB Materiality Map identifies sustainability issues that are likely to affect the financial condition or operating performance of companies within an industry. There are 26 general categories focusing on broad sustainability issues impacting corporations. Sustainability accounting reflects the management of a corporation's environmental and social impacts arising from production of goods and services, as well as its management of the environmental and social capitals necessary to create long-term value. It also includes the impacts that sustainability challenges have on innovation, business models, and corporate governance and vice versa. Therefore, SASB's sustainability topics are segmented into five broad dimensions: 1. Environment (6 issues): This dimension includes environmental impacts, either using non-renewable, natural resources as inputs to the factors of production or through harmful releases into the environment that may result in impacts to the company's financial condition or operating performance. 2. Social Capital (7 issues): This dimension relates to the expectation that a business will contribute to society in return for a social license to operate. It addresses the management of relationships with key outside parties, such as customers, local communities, the public, and the government. It includes issues related to human rights, protection of vulnerable groups, local economic development, access to and quality of products and services, affordability, responsible business practices in marketing, and customer privacy. 3. Human Capital (3 Issues): This dimension addresses the management of a company's human resources (employees and individual contractors) as key assets to delivering long-term value. It includes issues that affect the productivity of employees, management of labor relations, and management of the health and safety of employees and the ability to create a safety culture. 4. Business Model and Innovation (5 issues): This dimension addresses the integration of environmental, human, and social issues in a company's value- creation process, including resource recovery and other innovations in the production process; as well as in product innovation, including efficiency and responsibility in the design, use phase, and disposal of products. 5. Leadership and Governance (5 issues): This dimension involves the management of issues that are inherent to the business model or common practice in the industry and that are in potential conflict with the interest of broader stakeholder groups, and therefore create a potential liability or a limitation or removal of a license to operate. This includes regulatory compliance, risk management, safety management, supply- chain and materials sourcing, conflicts of interest, anticompetitive behavior, and corruption and bribery. In developing its standards, the SASB identified sustainability topics from a set of 26 broadly relevant sustainability issues (Exhibit 3.8) organized under these five sustainability dimensions. EXHIBIT 3.8 SASB Universe of Sustainability Issues Although the "universe" of sustainability issues served as a starting point for the SASB's standard setting, this extensive list was refined through a series of steps designed to identify those issues reasonably likely to have material impacts on companies in an industry. Because each of these issues tends to have a different impact or consequence depending on the context in which it arises, sustainable corporate activities will vary from one industry to another, meaning each industry has its own unique sustainability profile. The disclosure topics included in SASB's industry-specific standards are therefore a sub-set of this universe of sustainability issues, tailored to the industry's specific context. How Are The Standards Developed? The SASB standards are developed in accordance with its conceptual framework that sets the concepts, objectives and principles that guide its standard- setting process. In setting its standards, SASB takes an evidence-based, market- driven approach to determine whether sustainability topics are likely to be of interest to an investor, and reasonably likely to have material impacts on the financial condition or operating performance of the company. Significant research and market engagement at both the industry and company level are key to this end. In addition to identifying issues that are reasonably likely to be material, and decision- useful for both companies and investors, the objectives also give credence to cost- effectiveness for the corporation. Not only focusing on financially material issues, SASB also attempts to harmonize its standards with existing metrics and frameworks, where possible, to minimize the corporate reporting burden. The SASB Conceptual Framework also outlines principles for topic selection, including the potential for the topic to affect the ability to create value. It also lays out criteria for accounting metrics, including completeness, comparability and verifiability. Based on input from companies that have already implemented their standards, SASB offers the following approach for companies evaluating their adoption: ✓ Review and understand SASB metrics. ✓ Analyze the delta between existing information and planned disclosures. Identify SASB metrics to be disclosed. ✓ Ensure data reliability. ✓ Evaluate internal control over SASB metrics. ✓ Consider disclosure controls and procedures. ✓ Consider independent, third-party assurance. While the SASB standards are broken down into the 77 sectors across the 11 industry categories, the specific issues that drive long-term value creation will vary from company to company, as well as from one industry to the next. Accordingly, when evaluating SASB standards implementation, consideration needs to be given not only to the key issues, but also any unique circumstances relevant to the business model, strategy and other contextual factors of the company. Why Are The Standards Needed? The SASB standards and its reporting methodology focus on producing organizational decision- useful information for the investment community. Corporations reporting against the SASB standards can communicate with their investment community, producing comparable non- financial information and analysis of critical ESG issues affecting their ecosystem. The investment community is then able to compare industry performance, as well as risks and opportunities across the environmental, social and governance factors. It enables them to look beyond the traditional financial statements before making investment decisions. TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES (TCFD) The TCFD - a private-sector task force created by the Financial Stability Board - issued its final recommendations on climate- related financial disclosure in June 2017, focusing on climate- related risks, opportunities, and financial impacts, as well as scenario analysis. The Task Force's recommendations apply to non-financial companies and financial-sector organizations, including banks, insurance companies, asset managers and asset owners. Background The Financial Stability Board (FSB) created the Task Force on Climate-related Financial Disclosures (TCFD) in 2015. This came after the G20 finance ministers and central bank governors requested that the FSB consider the risks inherent in climate change. In 2017, the TCFD released climate-related financial disclosure recommendations to address the need for reliable corporate disclosure of climate- related information. Recognizing that climate risk is material for many organizations, the TCFD encouraged all entities with public debt or equity securities to voluntarily adopt its disclosure recommendations. To ensure the controls and governance over the preparation of climate-risk disclosures and pointing to existing securities exchange requirements with the ensuing legal obligation to disclose material risks, it encouraged their inclusion in mainstream financial filings. It also recommended that asset owners and managers implement the recommendations, assessing the inherent risks in their portfolios, thereby better informing their investment decisions What Are The TCFD Recommendations? The TCFD recommendations are a framework structured around four core themes that represent core elements of how organizations operate: governance, strategy, risk management, and metrics and targets. Recommended disclosures that build out the framework with information that will help investors and others understand how reporting organizations think about and assess climate-related risks and opportunities support these four overarching recommendations. In addition, there is guidance to support all organizations in developing climate- related financial disclosures consistent with the recommendations and recommended disclosures. The guidance assists preparers by providing context and suggestions for implementing the recommended disclosures. For the financial sector and certain non- financial sectors, supplemental guidance was developed to highlight important sector- specific considerations and provide a fuller picture of potential climate-related financial impacts in those sectors. The structure is depicted in Exhibit 3.9 below, and the Task Force's recommendations and supporting recommended disclosures are presented in Exhibit 3.10. EXHIBIT 3.10 TCFD Recommendations and Guidance Core Themes Recommended Disclosures The recommendations are structured around four thematic areas that represent core elements of how organizations operate. 1. Governance: The organization's governance around climate-related risks and opportunities. 2. Strategy: The actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy and financial planning. 3. Risk management: The processes the organization uses to identify, assess and manage climate-related risks. 4. Metrics and targets: The metrics and targets used to assess and manage relevant climate-related risks and opportunities. The key to the recommended strategy disclosures, noted above, is to 'describe the potential impact of different scenarios, including a 2'C scenario, on the organization's businesses, strategy and financial planning'. Scenario analysis, a well-established method of assessing or analyzing the likelihood of a range of possible future states, is discussed extensively in the TCFD recommendation. EXHIBIT 3.10 The Recommendations and Supporting Recommended Disclosures Risk Metrics and Governance Strategy Management Targets Disclose the Disclose the Disclose how the Disclose the organization’s actual and organization metrics and governance potential impacts identifies, targets used to around climate- of climate- related assesses, and assess and related risks and risks and manages manage relevant opportunities.. opportunities on climate-related climate- related the organizations risks. risks and businesses, opportunities strategy, where such and financial information is planning where material such information is material. Recommended Disclosures a. Describe a. Describe the a. Describe the 3. Disclose the the board's climate-related organization's metrics used by oversight of risks and processes for the organization climate-related opportunities identifying and to assess risks and the assessing climate- related opportunities organization climate- related risks and b. Describe has identified risks. opportunities in management's over the short, line with its role in medium, and b. Describe the strategy and assessing and long term. organization's risk managing processes for management climate- b. Describe managing process. related risks the impact of climate- related and climate- risks. 4. Disclose opportunities. related risks Scope 1,Scope and c. Describe how 2, and, if opportunities processes for appropriate, on the identifying, Scope 3 organization's assessing, and greenhouse businesses, managing gas (GHG) strategy, and climate- related emissions, and financial risks are the related planning. integrated into risks. the c. Describe the organization's 5. Describe the resilience of overall risk targets used by the management. the organization's organization to strategy, manage taking into climate- related consideration risks and different opportunities climate- and related performance scenarios, against targets including a 2°C or lower scenario. Metrics and Targets For metrics and targets, the recommendations specify that reporting entities 'disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks. Here is a summary of the respective GHG emissions categories: 1. Scope 1: Direct GHG emissions - These emanate from sources that are owned or controlled by the business; principally the result of the generation of electricity, heat or steam - furnaces, boilers, turbines, etc.; processing of chemicals or materials, e.g., cement, aluminum, waste; transportation of materials, products, employees or waste in company-owned vehicles. 2. Scope 2: Electricity indirect GHG emissions - This category encompasses emissions from purchased electricity used in a company's equipment or operations; tracking purchased electricity creates the opportunity to evaluate risks and opportunities of alternative sources of electricity. 3. Scope 3: Other indirect GHG emissions - These are all indirect emissions (not included in scope 2) that are a consequence of the activities of the business, but that occur from sources not owned or controlled by the business for example, materials suppliers, third-party logistics providers, waste management suppliers, travel suppliers, lessees and lessors, franchisees, retailers, employees, and customers. Financial and Non-financial Sectors The supplemental guidance the task force created for the finance sector is Focused on banks insurance companies, asset owners and asset managers, including pension plans and foundations. The specific financial sector guidance was generated based on the belief, on the part of the Task Force, that 'disclosures by the financial sector could foster an early assessment Or climate-related risks and opportunities. improve pricing of climate related risks, and lead to more informed capital allocation decisions. The supplemental guidance the task force created for non-financial sectors was based on the 13 Industries that account for the largest GHG emissions, energy usage and water usage, broken down into four sectors based on similarities of climate-related risks as highlighted in the table. EXHIBIT3.11 Supplemental Guidance Groups Their Associated Industries Agriculture, Materials and Food, and Energy Transportation Buildings Forest Products Oil and gas Air freight Metal and Beverages Coal Passenger air mining Agriculture Electric utilities transportation Chemicals Packaged Maritime Construction foods transportation materials and Rail transportation Capital goods meats king services Real estate Paper and and Automobiles and management and forest components development products Climate-Related Risks and Opportunities The TCFD categories the climate-related risks as transition risks - related to the transition to a lower-carbon economy, and physical risks - related to the physical effects of climate change. 1. The transition risks include policy and litigation risks, technology innovations that may affect competitiveness in addition to market and reputation risks, as customer and community expectations continue to evolve. 2. The physical risks include acute risks - those that are event-driven, such as extreme weather events like hurricanes, cyclones, flooding or fires; and chronic risks - those that refer to longer term shifts in climate patterns, such as higher temperatures, that may contribute to extended heatwaves or sea-level rise. Climate-related opportunities may stem from a variety of sources, including creating efficiencies and innovations, the development of new technologies and products, the formation of new markets, and the financing infrastructure that will meet the needs of a new economy. To make more informed financial decisions, investors, lenders, and insurance underwriters need to understand how climate-related risks and opportunities are likely to impact an organization's future financial position as reflected in its income statement., cash flow statement, and balance sheet as outlined in Exhibit 3.11. EXHIBIT 3.11 TCFD Climate-Related Risks, Opportunities, and How Are The Recommendations Developed? The 31-member global task force represents a broad range of financial sector and non- financial sector representatives, a careful balance of users and preparers of climate- related financial disclosures. In developing its recommendations, the  task force considered the 'existing regimes for climate reporting across the G20 countries. It found that most requirements were not focused on financial information. It also reviewed the financial filing requirements for public companies across the G20 countries. The TCFD recommendations include a set of seven principles for effective disclosures. These principles help achieve high-quality and decision-useful disclosures that enable users to understand the impact of climate change on organizations. The principles, taken together, are designed help organizations make clear the linkages and connections between climate-related issues and their governance, strategy, risk management, and metrics and targets. Principle 1: Disclosures should present relevant information. Principle 2: Disclosures should be specific and complete. Principle 3: Disclosures should be clear, balanced, and understandable. Principle 4: Disclosures should be consistent overtime. Principle 5: Disclosures should be comparable among organizations within a sector, Principle 6: Disclosures should be reliable, verifiable and objective. Principle 7: Disclosures should be provided on a timely basis. In connection with the launch of the final recommendations report, the TCFD also issued an Annex report guiding the implementations of general and sector-specific disclosure recommendations. n 2020, the TCFD Issued follow-on reports, including the 2020 Statue Guidance on Scenario Analysis for Non-financial Companies, and Guidance on Risk Management Integration and Disclosure. Why Are The Recommendations Needed? The TCFD recommendations are suitable for all organizations and will help focus them on Disclosure across the lenses of governance, strategy and risk management. Establishing consistent and comparable metrics and targets that are applicable across all sectors, as well as specific metrics for most carbon-intense industries. Using scenario analysis to access the potential impact of the risks and opportunities of the transition to a low carbon economy on strategy and financial planning. Consistent adoption leading to effective measurement and improved organizational resilience. The FS8 created the TCFD to improve climate-risk disclosures that could promote more informed Investment and underwriting decisions and facilitate the effective allocation of capital in the financial markets. As more information becomes available about the widespread risks and effects of climate-change, the need for a robust and internationally consistent climate framework has become increasingly important. Demand for this information from asset owners and managers is critical to the assessment of risk in their portfolios, and public sector leaders have also begun to become more attuned to the importance of transparency, mandating disclosure requirements for the coming years. IN SUMMARY The tables below provide overview of key sustainability reporting frameworks and standards (Exhibit 3.12) and compare the guiding principles for defining report content and sustainability topics covered in each framework and standard (Exhibit 3.13). More information can be found in the full guidance documents for these reporting standards/frameworks that can be access via their respective websites.  Exhibit Overview of Key Sustainability Reporting Frameworks and Standards Intended Use Benefits AT-A-glance Specific, Sustainability Can be used to Enables Supports replicable Accounting Identify, companies to presentation and detailed Standards manage, report financially financially requirements Board and material metrics material for “WHAT" (SASB) communicate that are industry information #should be Standards financially specific to meet of globally to inform reported for material the needs of capital each Topic Sustainability investors decisions Information to globally Investors and may be used as a basis for Global Can be used Enables Supports Reporting to Companies to presentation of Initiative (GRI) help report the socially material Standards businesses impact information that understand of their social can be tailored to and and culture and communicate environmental geographies. the activities to impact of various business stakeholders on critical and sustainability may be used as a Issues to a basis for broad suitable range of criteria in an stakeholders assurance engagement Focuses on climate-related financial Principles-based Task Force on disclosures to Principles-based recommendatio Climate- help recommendation n serving as a related investors and s foundation for Financial others to manage and global climate- Disclosures understand report on climate related (TCFD) material risks risk globally disclosures. related to climate Frameworks: change A set of Promotes Principles based integrated Can be used guidance thinking to "HOW" is and and reporting explain to prepared, and that providers of for what broad enables financial topics are providers capital covered of financial Principles-based Integrated how a capital framework that Reporting company to understand does not prescribe creates value the any specific Framework over time by business model metrics or targets providing and how the relevant business information, strategy both drives value in financial and the nonfinancial short, medium, and long term  EXHIBIT 3.13 Comparison of Guiding Principles for Defining Report Content and Sustainability Topics Covered of Framework and Standard These standards and frameworks can complement each other and can be used in a single document. For example, a report can be published which uses the framework and discloses information in accordance with the GRI Standards. Therefore are most important to In addition to these four standards and frameworks, the Climate Disclosures Standards Board (CDSB) and WEF International Business Council (IBC), developed framework and metrics in disclosing decision-useful environmental information in mainstream reports and core and expanded metrics and disclosures that have been drawn whenever possible from existing standards and disclosures. CLIMATE DISCLOSURE STANDARDS BOARD (CDSB) Background The Climate Disclosures Standards Board (CDSB), an international consortium of business and environmental NGOS, developed a framework that companies can use to incorporate climate change and environmental information into their mainstream reports.The CDSB was formed at the World Economic Forum annual meeting in 2007 and builds on the work of its board member organizations, which include: CDP (formerly Carbon Disclosure Project; provides the Secretariat for the CDSB) The Climate Group World Economic Foundation (WEF) Sustainability Accounting Standards Board (SASB) World Resources Institute (WRI) disclose material information in their financial filings including material climate-related World Business Council for Sustainable Development (WBCSD) What Is The CDSD Framework? To provide an approach for disclosing decision-useful environmental information in mainstream reports, the primary audience of the CDSB Framework is the investor. Other stakeholders, including regulators and other parties having an interest in capital markets, may also be beneficiaries. The first CDSB Framework, the Climate Change Reporting Framework, released in 2010, focused on the risks and opportunities that climate change presents to an organization's strategy, financial performance and condition, The scope has since been expanded to encompass natural capital dependencies, environmental risks and opportunities, policies, strategies and targets ałong with environmental results and performance against those targets. The Framework includes guiding principles in Exhibit 3.14 that are designed to ensure that environmental information in mainstream reports is decision-useful to investors, is correct and complete and is based on criteria that are suitable for conducting assurance activities. The guiding principles are to be applied in determining, preparing and presenting all environmental information reported in accordance with the reporting requirements in the CDSB Framework. In addition to ensuring that the disclosed information is based on criteria suitable for conducting assurance activities, the principles state that the disclosures 'should look to the future as well asthe past and present and should communicate trends and factors relating to environmental information that is are likely to affect the organization's future performance, position, and development'. Exhibit CDSB Framework Guiding Principles P1 Environmental information shall be prepared applying the principles of relevance and materiality P2 Disclosures shal be faithfully represented Sustainability and Strategic Audit P3 Disclosures shall be connected with other information in the mainstream report P4 Disclosures shal be consistent and comparable P5 Discosures shall be clear and understandable P6 Disclosures shall be verifiable P7 Disclosures shall be forward looking The reporting requirements (REQS) in Exhibit 3.15, designed to encourage standardized disclosure of environmental information that complements and supplements other information in mainstream reports, out the type of environmental information that should be reported in mainstream reports for investors. The requirements are organized as follows: Requirements about the organization's environmental policies and strategy, risks and opportunities and governance thereof. Requirements about the organization's environmental results and performance. A requirement about management's outlook regarding environmental results, performance and impacts. Requírements about the way in which environmental information is and reported. Requirements about conformance with the CDSB Framework. EXHIBIT 3.15 CDSB Framework Reporting Requirements REQ-01 Governance- Disclosures shall describe the governance of environmental policies, strategy and information. REQ-02 Management's environmental policies, strategy and targets – Disclosures shall report management's environmental policies, strategy and targets, including the indicators, plans and timelines used to assess performance. REQ-03 Risks and opportunities- Disclosures shal explain the material current and anticipated environmental risks and opportunities affecting the organization. REQ-04 Sources of environmental impact - Quantitative and qualitative results, together with the methodologies used to prepare them, shall be reported to reflect material sources of environmental impact. REQ-05 Performance and comparative analysis - Disclosures shall include an analysis of the information disclosed in REQ-04 compared with any performance targets set and with results reported in a previous period. REQ-06 Outlook- Management shall summarize its conclusions about the effect of environmental impacts, risks and opportunities on the organization's future performance and position. REQ-07 Organizational boundary - Environmental information shall be prepared for the entities within the boundary of the organization or group for which the mainstream report is prepared and, where appropriate, shall distinguish information reported for entities and activities outside that boundary. REQ-08 Reporting policies- Disclosures shall cite the reporting provisions used for preparing environmental information and shall (except in the first year of reporting) confirm that they have been used consistently from one reporting period to the next. REQ-09 Reporting period- Disclosures shall be proided on an annual basis. REQ-10 Restatements - Disclosures shall report and explain any prior year restatements. REQ-11 Conformance - Disclosures shall include a statement of conformance with the CDSB Framework. REQ-12 Assurance -If assurance has been provided over whether reported environmental information is in conformance with the CDSB Framework, this shall be included in or cross-referenced the statement of conformance of REQ- 11. Both the Principles chapter and the Reporting Requirements chapter of the Framework document provide specifics as to the purpose of the specified requirement, along with additional explanatory guidance for implementation. How Is The CDSB Framework Developed? Ihe CDSB Framework draws on other reporting provisions including financial reporting Standards and principles, legislative and regulatory reporting requirements, along with the work OT CDSB Board members, as noted above, and guidance other authoritative sources issue. To underscore this approach, here are a few key definitions and terminology from the Framework: 1. Investors The CDSB Framework adopts the International Accounting Standard Board's (IASB) definition of investors that is: "existing and potential investors, lender. and other creditors in making decisions about providing resources to the entity" and Considers this definition to be equivalent to the definition of "providers offinancit capital" in the International Integrated Reporting Framework produced by the International Integrated Reporting Council (IRC). This definition is also considered align with the TCFD's definition of investors, lenders and insurance underwriters as the primary users of the mainstream report. 2. Natural capital The CDSB Framework adopts the IIRCs definition that is: "a renewable and non- renewable environmental resources and processes that provide goods or services that support the past, current or future prosperity of an organization It includes air, water, land, minerals and forests, biodiversity and ecosystem health." 3. Sources of environmental impact Sources of environmental impact are the activities of and outputs from the organization that actually or potentially influence or contribute to environmental impacts, including: GHG emissions Sustainability and Strategic Audis Renewable/non-renewable energy generation, use and consumption Land use, land-use change and forestry (LULUCF) Non-GHG emissions to air, land and water (e.g., noise, odor, particulates, pollutants, etc.) Renewable and non-renewable material resource use (e.g., forest products, fish stocks, minerals, metals, etc.) Water use and consumption Waste and spillages (e.g., mining and hazardous waste, radiation and industrial by-products.) Why Is The CDSB Framework Needed? The CDSB recognizes that information about natural capital is essentially equal to financial capital in terms of providing an understanding of corporate performance; and is committed to a global mainstream reporting model that reflects that equality. Companies can use the CDSB Framework not only to incorporate climate change, environmental and natural capital-related information into their mainstream report, but also to achieve a more holistic view of related risks and opportunities and their effect on performance. Investors and analysts can be better equipped to make well-informed capital allocation decisions; regulators and stock exchanges can benefit from standards-ready material for compliance and listing requirements. The framework aims to: Help companies translate their sustainability information into long-term value; Provide clear, concise and consistent information to investors, connecting tne organization's environmental performance to its overall strategy, performance and prospects; Enable and encourage informed investor -decision making on the allocation of financial capital; and Add value to an organization's existing mainstream report, while minimizing thne reporting burden and simplifying the reporting process. WORLD ECONOMIC FORUM INTERNATIONAL BUSINESS CoUNCIL: MEASURING STAKEHOLDER CAPITALISM Background The World Economic Forum (WEF) Report Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation is a collaboration between Deloitte, KPMG, EY, PwC and the WEF International Business Council (|BC). They committed in 2017 to align their corporate goals with the long-term goals of society. In 2019 the lBC reaffirmed the significance of ESG in business risk and long-term value creation. The lack of consistency and comparability of reporting frameworks and metrics in the ESG space also flagged. Consequently, this project was launched to (identify a set of universal, material ESG metrics and recommended disclosures that could be reflected in the mainstream annual reports of companies on a consistent basis across industry sectors and countries. Following a public consultation, the final report was published in September 2020. What are WEF's common metrics for measuring capitalism? Common Metrics The result is a collection of core and expanded metrics and disclosures that have been drawn whenever possible from existing standards and disclosures. Selection criteria also included materiality to long-term value creation, universality, extent of actionability, and feasibility of reporting. Core metrics (24) - These are more established or critically important metrics and disclosures that are already being reported by many organizations or can be obtained with reasonable effort. They are primarily quantitative metrics focused on activities within the boundaries of the reporting organization. Expanded metrics (34) - Less well-established in existing practice and standards and have a wider value chain scope or convey impact in a more sophisticated or tangible way, such as in monetary terms. They represent a more advanced way of measuring and communicating sustainable value creation. While not intended to replace relevant industry sector, or company-specific indicators, themetrics have been selected for their universality. Companies are encouraged to report on as many metrics as they find material and appropriate based on a "disclose or explain" approach. The Four Pillars Tne metrics are organized along the lines of the four pillars - Principles of Governance, Planet, People and Prosperity, which are aligned with the UN Sustainable Development Goals (SDGs). While each of the pillars is important to the firm's capacity to create shared and sustainable value, they are highly interdependent and should not be taken in isolation. Governance is foundational for a company in setting purpose and provides oversight for a company's activities that contribute to a prosperous, sustainable society. Without good governance, companies lack the supportive context withín which to make progress on the other three pillars. Without a healthy planet to provide the clean air, fresh water, agriculture, forests and fisheries on which human life depends, societies cannot succeed, and companies cannot create long-term value. People are at the center of global economic prosperity, driving wealth creation, developing innovative products and services and supporting the communities in which they live and work. Companies perform better when their employees are well-trained, diverse and financialy secure. The inclusion of prosperity as the fourth pilar takes this project's work beyond simply "ESG", highlighting the importance of prosperous societies and the role of businesses in fueling economic growth, innovation and shared wealth. Core and Expanded Metrics and Disclosures Each pillar comprises up to seven themes, considered to be the most important to society, the planet and the economy, and the most universally relevant to all companies. Each theme is critical to a comprehensive understanding of lts pllar and groups together one or more corresponding metrics or disclosures to measure corporate performance and sustainable value creation. All metrics are drawn from existing frameworks and standards, where available. The core and expanded metrics and disclosures outlined under these four pillars that have also been established thematically are: Exhibit 3.17 PRINCIPLES OF GOVERNANCE: Core and Expanded Metrics and Disclosures Theme Governing purpose Quality of governing body Stakeholder engagement Core Metrics Disclosures Setting purpose The company's stated purpose, as the expression of the means by which a business proposes solutions environmental and social issues. Corporate to economic, purpose should create value for all stakeholders, including shareholders. Governance body composition Composition of the highest governance body and its committees by: competencies relating to economic, environmental and social topics; executive or non-executive; independence; tenure on the governance body; number of each individual's other significant positions and commitments, andthe nature of the commitments; gender; membership of under-represented social groups; stakeholder representation. Material issues impacting stakeholders A list of the topics that are material to key stakeholders and the company, how the topics were identified and how the stakeholders were engaged. EXPANDED METRICS AND DISCLOSURES Purpose-led management How the company's stated purpose is embedded in company strategies, policies and goals. Progress against strategic milestones Disclosure of the material strategic economic, environmental and social milestones expected to be achieved in the following year, such milestones achieved from the previous year, and how those milestones are expected to or have contributed to long- term value. Remuneration 1. How performance criteria in the remuneration policies relate to the highest governance body's and senior executives' objectives for economic, environmental  and social topics, as connected to the company's stated purpose, strategy and long-term value. 2. Remuneration policies for the highest governance body and senior executives for the following types of remuneration: Fixed pay and variable pay, including performance-based pay, equity-based pay, bonuses and deferred or vested shares Sign-on bonuses or recruitment incentive payments Termination payments Clawbacks Retirement benefits, including the difference between benefit schemes and contribution rates for the highest governance body, senior executives and all other employees. Theme: Ethical behaviour Risk and opportunity oversight stakeholders were engaged. Anti-corruption 3. Total percentage of governance body members, employees and business partners who have received training on the organization's anti-coruption policies and procedures, broken dowm by region. a. Total number and nature of incidents of corruption confimed during the current year, but related to previous years; and b. Total number and nature of incidents of corruption confirmed during the current year, related to this year. 4. Discussion of initiatives and stakeholder engagement to improve the broader operating environment and culture, in order to combat corruption. Protected ethics advice and reporting mechanisms. A description of internal and external mechanisms for: a. Seeking advice about ethical and lawful behavior and organizational integrity; and b. Reporting concerns about unethical or unlawful behavior and lack of organízational integrity. Integrating risk and opportunity into business process Company risk factor and opportunity disclosures that clearly identify the principal material risks and opportunities facing the company specifically (as opposed to generic sector risks), the company appetite in respect of these risks, how these risks and opportunities have moved overtime and the response to those changes. These opportunities and risks should integrate material economio, environmental and social issues, including climate change and data stewardship. Sustainability and Strategic Audit Alignment of strategy and policies to lobbying the significant issues that are the focus of the company's participation in public policy development and lobbying the company's strategy relevant to these areas of focus; and any differences between its lobbying positions and its purpose, stated policies, goals or other public positions. Monetary losses from unethical behaviour Total amount of monetary losses as a result of legal proceedings associated with fraud, insider trading, anti-trust, anti- competitive behaviour, market manipulation, malpractice or violations of other related industry laws or regulations. Economnic, environmental and social topics in capital allocation framework How the highest governance body considers economic, environmental and social issues when overseeing major capital allocation decisions, such as expenditures, acquisitions and divestitures. EXHIBIT 3.18 PLANET: Core and Expanded Metrics and Disclosures Theme Climate change Nature loss Core Metrics and Disclosures Greenhouse gas (GHG) emissions For all relevant greenhouse gases (e.g.. carbon dioxide, methane, nitrous oxide, F.- gases etc.), report in metric tonnes of carbon dioxide equivalent (tCO2e) GHG Protocol Scope 1 and Scope 2 emissions. Estimate and report material upstream and downstream (GHG Protocol Scope 3) emissions where appropriate. TCFD implementation Fully implement the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). If necessary, disclose a timeline of at most three years for full implementation. Disclose whether you have set, or have committed to set, GHG emissions targets that are in line with the goals of the Paris Agreement- to limit global waming to well below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C - and to achieve net-zero emíssions before 2050. Land use and ecological sensitivity Expanded Metrics and Disclosures Paris-aligned GHG emissions targets adjacent to protected areas and/or key biodiversity areas (KBA) Define and report progress against time- bound science-based GHG emissions targets that are in line with the goals of the Paris Agreement- to limit global warming to well below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C. This should include defining a date before 2050 by which you will achieve net-zero greenhouse gas emissions, and interim reduction targets based on the methodologies provided by the Science Based Targets initiative, if applicable. If an alternative approach is taken, disclose the methodology used to calculate the targets and the basis on which they deliver on the goals of the Paris Agreement. Impact of GHG emissions Report wherever material along the value chain (GHG Protocol Scope 1, 2 & 3) the valued impact of greenhouse gas emissions. Disclose the estimate of the societal cost of carbon used and the source or basis for this estimate. Land use and ecological sensitivity Report the number and area (in hectares) of | Report for operations (if applicable) and sites owned, leased or managed in or full supply chain (if material): 1. Area of land used for the production of basic plant, animal or mineral commodities (e.g., the area of land used for forestry, agriculture or mining activities). 2. Year-on-year change in the area of land used for the production of basic plant, animal or mineral commodities. Note: Supply-chain figures can initially be estimated where necessary based. Theme: Water pollution | Freshwater availability Air pollution Water consumption and withdrawal in water- stressed areas Report for operations where material: megalitres of water withdrawn, megalitres of water consumed and the percentage of each in regions with high or extremely high baseline water stress, according to WRI Aqueduct water risk atlas tool. Estimate and report the same information for the full value chain (upstream and downstream) where appropriate. Sustainability and Strategic Audit on the mass of each commodity used and the average mass produced per unit of land in different sourcing locations. Percentage of land area in point 1 above or of total plant, animal and mineral commodity inputs by mass or cost, covered by a sustainability certification standard or formalized sustainable management programme. Disclose the certification standards or description of sustainable management programmes along with the percentage of total land area, mass or cost covered by each certification standard/programme. Impact of land use and Conversion Report wherever material along the value chain: the valued impact of use of land and conversion of ecosystems Impact of freshwater consumption and withdrawal Report wherever material along the value chain: the valued impact of freshwater consumption and withdrawal. Air pollution Report wherever material along the value chain: nitrogen oxides (NOx), sulphur oxides (SOx), particulate matter and other significant air emissions. Wherever possible stimate the proportion of specified emissions that occur in or adjacent to urban/densely populated areas. Impact of air pollution Report wherever material along the value chain: the valued impact of air pollution, including nitrogen oxides (NOx), sulphur oxides (SOx), particulate matter and other significant air emissions. Nutrients Estimate and report wherever material Soid waste Resource avalability along the value chain: metric tonnes of nitrogen, phosphorous and potassium in fertilizer consumed. Impact of water pollution Report wherever material along the value chain: the valued impact of water pollution, including excess nutrients, heavy metals and other toxins. Single-use plastics Report wherever material along the value chain: estimated metric tonnes of single- use plastic consumed. Disclose the most significant applications of single-use plastic identified, the quantification approach used and the definition of single-use plastic adopted. Impact of solid waste disposal Report wherever material along the value chain, the valued societal impact of solid waste disposal, including plastics and other waste streams. Resource circularity Report the most appropriate resource the whole circularity metric(s) for Company and/or at a product, material or site level as applicable. Potential metrics include (but are not limited to) the Circular Transition Indicators (WBCSD), indicators developed by the Ellen MacArthur Foundation and comparny developed metrics. Disclose the methodological approach used to calculate the chosen circularity metric(s) and the rationale for the choice of metric(s). EXHIBT 3.10 PEOPLE: Core and Expanded Metrics and Disclosures Theme: Dignity and equality Core Metrics and Dlsclosures Diversity and inclusion (%) Percentage of employees per employee category, by age group, gender and other Indicators of diversity (e.g., ethnicity). Pay equality (%) Ratio of the basic salary and remuneration for each employee category by significant locations of operation for priority areas of equality: women to men, minor to major ethnic groups, and other relevant equality areas. Wage level (%) 1. Ratios of standard entry level wage by gender compared to local minimum wage. 2. Ratio of the annual total compensation of the CEO to the median of the annual total compensation of all its employees, except the CEO. Risk for incidents of child, forcedor compulsoy labour An explanation of the operations and suppliers consldered to have significant disk for incidents of child labour, forced or compulsory labour. Such risks could emerge in relation to: type of operation (such as manufacturing plant) and type of supplier; and countries or geographic areas with operations and suppliers considered at risk. EXPANDED METRICS AND DISCLOSURES Pay gap (%, #) 1. Mean pay gap of basic salary and remuneration of full-time relevant employees based on gender (women to men) and indicators of diversity (e.g., BAME to non- BAME) at a company level or by significant location of operation. 2. Ratio of the annual total compensation for the organization's highest-paid individual in each country of significant operations to the median annual total compensation for all employyees (excluding the highest- paid individual) in the same country. Discrimination and harassment incidents (#) and the total amount of monetary losses ($) Number of discrimination and harassment incidents, status of the incidents and actions taken, and the total amount of monetary losses as a result of legal proceedings associated with: a) law violations; and b) employment discrimination. Freedom of association and collective bargaining at risk (%) 1. Percentage of active workíorce covered under collective bargaining agreements. 2. An explanation of the assessment performed on suppliers for which the right to freedom of association and collective bargaining is at risk, including measures taken by the organization to address these risks. Human rights review, grievance impact & modern slavery (%) 1. Total number and percentage of operations that have been subject to human rghts reviews or human rights Impact assessments, by country. 2. Number and type of grievances reported with associated impacts related to a salient human rights issue in the reporting period and an explanation of impacts. 3. Number and percentage of operations and suppliers considered to have significant risk for incidents of child labour, forced or compulsory labour. Such risks could emerge in relation to a) type of operation (such as manufacturing plant) and type of supplier or b) countries or geographic areas with operations and suppliers considered at risk. Theme: Health and well-being Skills for the future operations and suppliers considered at risk. Health and safety (%) 1. The number and rate of fatalities as a result of work-related injury; high- consequence work-related injuries (excluding fatalities); recordable work- related injuries; main types of work- related injury; and the number of hours worked.services, and the scope of access provided for employees and workers. explanation on type of impacts. Training provided (#,%) Living wage (%) Current wages against the living wage for employees and contractors in states and localities where the company is operating. Monetized impacts of work-related incidents on organization (#, $) By multiplying the number and type of occupational incidents by the direct costs for employees, employers per incident (including actions and/or fines from regulators, property damage, healthcare costs, compensation costs to employees). Employee well-being (#%) 1. The number of fatalities as a result of work-related ill-health, recordable work- related il-health injuries, and the main types of work-related ill-health for all employees and workers. 2. a) Percentage of employees participating in "best practice” health and well-being programmes, and b) Absentee rate (AR) of all employees. Number of unfilled skilled positions (# %) Average hours of training per person that have the organization's employees undertaken during the repoting period, by gender and employee category (total | 2. number of hours of training provided to employees divided by the number of employees). 1. Number of unfilled skilled positions(#). 2. Percentage of unfilled skilled positions for which the company will hire unskilled candidates and train them (%). Theme and development Average training expenditure per full time employee (total cost of training provided to employees divided by the number of employees). Employment and wealth generation CORE METRICS AND DISCLOSURES Absolute number and rate of employment 1. Total number and rate of new employee hires during the reporting period, by age group, gender, other indicators of diversity and region. 2. Total number and rate of employee turnover during the reporting period, by age group, gender, other indicators of diversity and region. Exhibit 3. PROSPERITY: Core and Expanded Metrics and Disclosures Economic contribution 1. Direct economic value generated and distributed (EVG&D), on an accruals basis, covering the basic components for the organization's global operations, ideally split out by: Revenues Operating costs Employee wages and benefits Payments to providers of capital Payments to government Community investment Monetized impacts of training 2. Financial assistance received from the Increased earning capacity as a result of training intervention (%, $) a. Investment in training as a percentage (%) of payroll. b. Effectiveness of the training and development through increased revenue, productivity gains, employee engagement and/or internal hire rates. EXPANDED METRICS AND DISCLOSURES Infrastructure investments and services Supported Qualitative disclosure to describe the below components: 1. Extent of development of significant infrastructure investments an