Accountability and transparency can be achieved through corporate annual reporting. By disclosing a company’s risks, performance, strategy, targets etc on sustainability and ESG issues keep the stakeholders informed on relevant issues. Even better in case the reports are externally assured by an independent third party.
Companies have a large number of standards and frameworks to choose from for reporting purposes, each one developed with a different stakeholder group – or groups – in mind.
The GRI (2022) has attempted a high level approach to separate frameworks and guidelines from standards at a “GRI Perspective”
As per GRI, Standards “are the agreed level of quality requirements, that people think is acceptable for reporting entities to meet. A standard can be thought of as containing specific and detailed criteria or metrics of ‘what’ should be reported on each topic. In general,
corporate reporting standards have in common the following features: a public interest focus, independence, due process, and public consultation, generating a stronger basis for the information being asked“, while
Frameworks “provide the ‘frame’ to contextualize information. Frameworks are those that are normally put into practice in the absence of well-defined standards. A framework allows for flexibility in defining the direction, but not the method itself. A framework can be thought of as a set of principles providing guidance and shaping people’s thoughts on how to think about a certain topic, but miss a defined reporting obligation” (GRI, 2022).
A company’s reports are made available to the public. There is a number of places one can find sustainability and CSR reports from a number of companies such as:
A large number of rating and ranking agencies exist, to classify companies based on their ESG performance and risk management, based on their respective ESG score. Each rating and/or rating company, has its own criteria for evaluation.