Convergence of Global Sustainability Reporting Standards: Need of the Hour

Abstract

Convergence of Sustainability Reporting Standards: Need of the Hour: Abstract

Effective sustainability reporting is considered to be a meaningful and effective medium of communicating with stakeholders about how companies are performing on the basis of their objectives. In this challenging and dizzyingly fast-changing sustainability reporting landscape, another most notable occurrence is the acceleration of efforts to converge toward a single and uniform sustainability reporting standard.

The five organisations namely SASB, CDP, GRI, CDSB and IIRC that are involved in the setting of global standards relating to sustainability reporting have expressed their intention to work jointly to develop a single set of sustainability reporting standards. New initiatives from the World Economic Forum and IFRS Foundation support the case for globally accepted sustainability reporting standards. Moreover, the COVID-19 pandemic has highlighted the importance of sustainable and resilient business models to support the economic recovery strategies of companies, along with an insightful reporting to provide stakeholders with a clear understanding of those models. The pandemic has also raised awareness of the inextricable links between the environment, society and the regulatory and policy environment. These developments are directed towards an urgent need for a more robust sustainability reporting framework.

It is expected that the application of these standards will be compulsory irrespective of its size- big or small or irrespective of its nature- private or public throughout the globe. The exact timeline for implementation of these standards remains a difficult issue to ascertain, but it is expected that it would be within a few years.