Sustainability reporting grows ever more mature, complex and demanding.
Investors are demanding more transparency. Regulatory requirements are intensifying. The number and complexity of frameworks, standards, ratings and indices has increased – even with efforts to increase harmonisation. Formats and channels are diversifying, with digitalisation accelerated by the pandemic.
This is generally positive and certainly a testament to the efforts made to accelerate the prominence of sustainability in business. Sustainability reporting is becoming increasingly rigorous. At the same time, it is more accessible and mainstream than ever before, allowing it to provide valuable input to decisions made by your stakeholders. But this boom in reporting does not come without its challenges.
What are the main reporting challenges?
As the complexity of the reporting landscape intensifies, we’re seeing an increase in the quantity of information being communicated. However, whether the quality of reporting has followed suit is debatable.
An article produced earlier in the year from the Harvard Business Review highlighted a range of challenges, with its headline stating that while sustainability reporting has become widespread, environmental damage and social inequality is still growing. Reporting on its own does not ensure environmental and social improvement.
What’s the way forward?
- Measure less, but better. There is no point expanding on further metrics if that most-crucial data – usually your carbon emissions – is unreliable. Ensure accurate meter setup, continually improving your monitoring processes and explore data automation solutions.
- Mapping what is material. Materiality assessments enable companies to identify sustainability issues that are important to all stakeholders. Used to their full potential they can help shape company strategy, galvanise internal functions and gain senior buy-in, as well as uniting disparate teams and processes. Materiality assessments should be regularly reassessed to better integrate sustainability into business strategy and to inform meaningful sustainability communications.
- Report to your different audiences. It may be said that a report aimed at everyone will resonate with no one. This doesn’t mean ignoring secondary audiences, but rather making a conscious choice about which audience you’re prioritising across the different channels of the reporting ecosystem. If you’re prioritising a specific audience through your main sustainability report, think about how you could leverage and personalise your website and social media to communicate with your secondary audience(s).
EVORA designs reporting strategies for organisations, enabling them to apply frameworks, communicate meaningful sustainability outcomes and impacts to key stakeholders and use reporting as a tool to improve sustainability performance. Get in touch with the EVORA reporting team today.