UNEP recently released their report Raising the Bar – Advancing Environmental Disclosure in Sustainability reporting. The findings show that sustainability reports are insufficient in representing company impacts on environment in full.
An increasing number of companies are issuing sustainability reports, especially among larger companies and corporations, as stakeholders often require companies to document the impacts of their operations. UNEP calls companies to do more to address the environmental and social impacts of their operations and according to requirements in the 2030 Agenda for Sustainable development.
There are four main areas in which companies mainly report on sustainability:
- GHG emissions
- Materials and Waste
The report finds that the sustainability reports often do not represent the full extent of companies’ environmental and social impact. There is significant room for improvement, especially when it comes to addressing use of water and resources. These areas may also unlock emission sources in the value chain, and are hence important to get the full picture. Having a better overview of how the company impacts its surroundings would improve decision-making and add value to the business.
According to the report, there are three main areas that should be addressed in future sustainability reporting to give stakeholders and the company itself a better overview of impacts:
- The need for harmonizing and strengthening of materiality determination, and assurance methodologies.
- The need for greater collaborative reporting, through more engagement with upstream value chains (e.g. suppliers) and downstream stakeholders, to transform sustainability reporting from the current one-way, broadcast-type format to a more multi-directional, dynamic, ongoing exchange with all relevant stakeholders.
- An alarming under-use of the sustainability context principle - placing performance of a company in the context of the limits and demands on environmental or social resources.
To read more about the report and findings, please view UNEPs news article about the report. You can also download the report here.
DNV GL has contributed to the report. You can also read more about our work with sustainability reporting assurance in Annex 2 of the report, where we have contributed with an example of a good quality assurance statement.