Today, companies are judged not just on the financial results they post, but also on the impacts they are having on the environment, their communities, and on governance. Because of this, the task of sustainability reporting has moved from a required exercise in compliance to a vital component in driving strategic growth. Organizations working to account for Environmental, Social, and Governance (ESG) factors in the deepest way possible — which is where General Sustainability Reporting plays a key role.
That’s why Sustrack offers “General Sustainability Reporting” as part of our ESG Consultancy Services to enable organizations to develop sustainability reports that are not just compliant with international standards, but also aligned with transparency, relevancy, and value-creation. Ahead we will unpack the why, the what, and the how of organizations getting it right, together!
Reasons for General Sustainability Reporting to be Important
Compliance with Regulations
Around the world, government agencies are increasingly requiring ESG and non-financial disclosures. Whether it’s rules regarding environmental impact, ethical sourcing and supply chain issues, human rights, or governance, organizations need to keep up. A strong sustainability report makes sure that you are compliant and can avoid regulation.
Credibility with Stakeholders
Investors, customers, employees, and civil society are increasingly expecting companies to be transparent about their ESG performance. Companies report transparently and use international frameworks, to build trust. Transparency conveys accountability, which drives reputation, brand trust, and access to capital.
Insight & Strategic Improvement
Collecting data and assessing sustainability does not just show a company’s current status; it highlights gaps, inefficiencies, and areas for improvement. A clear sustainability report can be useful for strategic decision making, target setting, and tracking progress over time.
Creating Value
Good reporting can be more than just checking boxes. It can help improve efficiency (i.e. reduce waste, reduce energy use), improve stakeholder interactions, attract ESG conscious investors, and unlock new opportunities with partners that require good ESG performance.
Importance of General Sustainability Reporting
Compliance with Regulatory Requirements
Regulatory authorities around the world are increasingly requiring ESG / non-financial disclosures. From regulations about environmental impact, to ethical supply chains, to human rights, to governance practices — organizations must be prepared for these regulations. A strong sustainability report ensures you are meeting these requirements, as well as averting the risks of non-compliance.
Credibility with Stakeholders
Investors, customers, employees, and civil society increasingly expect companies to be transparent in their
reported ESG performance. Companies that take responsibility for openly reporting, and utilizing internationally recognized frameworks, can build trust. Transparency is a signal of accountability, and in turn, can enhance reputation, strengthen brand equity, and access to capital.
Strategic Thinking & Improvement
Gathering data and reporting does more than show where you are it will expose gaps, inefficiencies and opportunities for improvement. An insightful sustainability report can guide strategic decisions, set targets and assess progress over time.
Value Creation
Executing effective reporting can do more than “tick boxes.” It can help to streamline operations (e.g. reduce waste, cut energy use), improve stakeholder relations, attract ESG — focused investors and establish partnerships w new business opportunities requiring solid ESG credentials.
Sustrack’s General Sustainability Reporting
The “General Sustainability Reporting” service from Sustrack is one of a series of ESG Consultancy Services. Sustrack’s General Sustainability Reporting service is meant to help organizations produce reports that are “reliably clear and relevant” in respect of international expectations. Straight from the service description, here are some of the highlights of this approach:
Technology-Driven Processes
Digital tools and platforms are used to make the collection, monitoring, and reporting of sustainability data more streamlined. Processes are likely to be less manual, less error-prone, and faster. Sustrack emphasizes being “technology-driven” in its solutionsFor instance, the sustainability reporting frameworks that are built into the Sustrack roadmap provide a simple way to create reports that use the indicators you selected which align with an internationally recognized reporting framework.
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Alignment with Regulatory & International Standards
Sustrack provides a pathway to ensure that the reports you produce align with global guidelines and regulatory frameworks — for instance, GRI (Global Reporting Initiative), CDP, or any other such frameworks. The frameworks can help you structure the information you plan to report and the indicators you will use to define the metrics, but perhaps most importantly, they can help you determine how to present results in ways your stakeholders expect.
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Integrated Reporting
Sustrack supports reporting which is “integrated,” meaning trying to avoid “siloing” ESG data or healthiness of financial performance independent of each other. Integrated reporting means creating a single report that assesses both financial and non-financial performance in the same report. This style of reporting allows for a more holistic reporting of organizational performance rather than adding layers of reporting to demonstrate how ESG factors may or may not be impacting financial health and long-term value.
Clarity, Relevance & Materiality
The goal is not downloads of data; with Sustrack all reporting should be conducted with clarity and relevance to stakeholders in mind. Sustrack works with organizations in materiality assessment: identifying what issues (environmental, social, governance) are material to both the organization internally and externally to their audiences to ensure that the reporting is focused on the greatest impact.
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Image & Value Enhancement
A sustainability report, when completed correctly, can support a better public image and create value (not just avoiding risks). Transparent and accurate reporting that tells a compelling story helps dial in and build stakeholder trust; this can impact investors, see the influence of customer loyalty, and/or support relations with partners. Sustrack offers its reporting services not just for compliance but enhancing the image of companies while protecting clients and creating “sustainable value.”
Considerations for Organizations on Sustainability Reporting
Understanding what Sustrack platforms offer is one thing, but whether reporting achieves value is about how it is done. The following are best practices to keep in mind:
Start with Materiality
You do not have to report on everything. Determine a manageable subset of issues that are most pertinent to your organization and your stakeholders. Quantitative and qualitative data can assess impact. Materiality allows you to prioritize your resources in the most appropriate way. As stakeholder concerns vary by sector, geography, and industry, what is material to one organization may not be material to another.
Ensure Data Quality
Data underpinning reports, which inform stakeholders, must be correct, verifiable, and consistent. This often means putting in systems to collect data, verify that data, an audit trail, and possibly independent third-party verification. Clean data demonstrates credibility to stakeholders. If your audience sees data discrepancies or a lack of transparency, it is more likely to erode trust as opposed to developing it.
Use Recognized Frameworks but Be Contextual
Global standards or frameworks like GRI, CDP, SASB, TCFD etc. provide a framework for reporting. However, organizations should modify those standards or frameworks taking into account the local context, your organization’s maturity level, and stakeholders expectations; while being a framework for compliance, the reporting to the stakeholders should be both readable and meaningful.
Develop a Narrative, Not Just Quantitative Data
By incorporating ESG performance into a narrative, you will convey things that numbers cannot wholly achieve. Tell the story of strategies, risks, opportunities, challenges, and how you are responding. Use imagery, case studies, comparisons over time, etc. Integrated reports (where financial and non-financial data are included together) help here too.
Set Goals and Monitor Your Progress
A good report is more than telling you where you are now, it boils down to establishing a vision and showing how you’ll get there, whether that be in a high-level roadmap/action plan, key performance indicators (KPIs), timeframes, accounting, etc to implement the article write up. “Year-over-year” (yoy) follow-up is a part of what proves, creates and establishes commitment.
Engage with Stakeholders
Have a site visit by inviting input from the people that matter — customers, employees, suppliers, investors, and communities. What do they care about? What ESG topics resonate with them? Their perspectives help shape the reporting and validate the credibility of the report.
Benefits Organizations Obtain: Beyond Compliance
By providing active and complete reporting on sustainability performance, businesses gain benefits that go beyond just “checking the box.” This includes:
Increased Interest from Investors: ESG investors are actively looking to invest in companies that have good reporting. Greater transparency may result in better credit ratings, better terms, and easier access to capital.
Operational Efficiency: Documenting how you are measuring ESG performance may reveal that there is some inefficiency in your operations — energy may leak, waste may be excessive, or assets may be under-utilized — and that once diffused will reduce the cost of doing business.
Risk Management: Environmental risks (climate impacts, resource scarcity), social risks (labour issues, human rights) and governance risks (regulatory, ethical) become much easier to see. Reporting requires you to look under the hood and begin to address or mitigate risk sooner.
Reputation and Brand Loyalty: Increasingly customers are making purchasing decisions that are value based. Being known as responsible may matter to customers. Clearer and honest reporting aids in establishing said reputation and building trust.
Employee Engagement and Attraction: Employees, particularly the younger generations, tend to care more about purpose. Companies that can demonstrate they are serious about sustainability are likely to attract and engage employees better.
Potential Obstacles & Their Solutions
Of course, sustainability reporting is not without its challenges. Below are some of the common challenges:
Data Gaps / Data Quality: Many organizations do not have foundational systems to collect more than basic data, especially when it comes to environmental topics.
Solution: Start small — build and grow the capacity, use professional partners, and/audit or assure to the extent that somethings possible.
Complexity of Standards: Sometimes the framework can be technical, overlapping, or changing, which is a ways to feel overwhelmed.
Solution: Use professional partners (like Sustrack), map what you need, simplify if you can, and stay on top of the latest.
Around Internal Buy-In: Reporting touches multiple departments: finance, operations, HR, procurement, etc. Getting all departments on board can be difficult.
Solution: Engaged leadership, clearly defined roles/responsibilities, training on the language of reporting, and you can even reference ESG as integrated into the business’ culture.
Over-Reporting vs. Under-Reporting: As an example, if you are under-reporting, you may be leaving out a material issue, while at the same time, over-reporting could mean reporting too much irrelevant detail.
Solution: Conduct regular materiality assessments, get stakeholder feedback, and focus on reporting what’s appropriate to the significance of the issue.
Conclusion
In an increasingly interrelated business world with sustainability risks and opportunities everywhere, general sustainability reporting is not optional, it is strategic. Sustainability reporting provide a pathway to transparency, stakeholders engagement, effective risk management and ultimately more resilient and responsible companies.
If your company is seeking to advance ESG reporting — to move beyond compliance, to create value with a compelling story, and build legitimate and sustainable value — you need partners who offer depth of expertise, clarity and technology enhanced platforms. Sustrack’s model of blending regulation with narrative clarity, integrated
Visit us for more info:-https://www.sustrack.com/
