As ESG takes center stage, the SASB Standards provide consistency

As ESG takes center stage, the SASB Standards provide consistency

As ESG takes center stage, the SASB Standards provide consistency

  • Posted by admin
  • On February 17, 2023
  • Atul Deshmukh


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As ESG takes center stage, the SASB Standards provide consistency

As the world becomes increasingly focused on environmental, social, and governance (ESG) issues, it’s more important than ever to have consistent standards for measuring and reporting on these topics. That’s where the Sustainability Accounting Standards Board (SASB) comes in.

The SASB Standards give businesses a uniform framework for measuring and disclosing their ESG performance, resulting in more precise and trustworthy data for stakeholders including investors and legislators. The SASB Standards cover a wide range of industries and focus on the material issues most likely to impact a company’s financial performance.

Nearly 200 nations reached an agreement in 2015 called “the Paris Agreement” that requires businesses to make financial statements on climate change. As a result, companies worldwide are working to boost the openness of their ESG (Environment, Social, Governance) & sustainability disclosures and reveal how they adhere to the Paris Agreement.

Investors are drawn to ESG and sustainability-focused businesses and look for information that can be used to make investment decisions. As a result, sustainability disclosures are now crucial to an organization’s operational and financial success.

The shift towards better reporting procedures and standardization is being driven by increasing importance. For example, 90% of S&P 500 corporations, according to the Governance & Accountability Institute, released sustainability reports in 2019.

Furthermore, according to a recent study by the US SIF (The Forum for Sustainable and Responsible Investment), the value of sustainable investment methods would rise by 42% by 2020, from $12 trillion to $17 trillion. In addition, according to Bank of America, another $20 trillion is anticipated to flow into ESG funds over the next 20 years, fueling the momentum for ESG and sustainability investing.

The Sustainability Accounting Standards Board (SASB) offers data standards and reporting frameworks as a step toward resolving the sustainability reporting issue, helping businesses produce reliable, transparent performance.

Companies can use the SASB Standards to demonstrate their commitment to sustainability and responsible business practices while providing valuable information to their investors and other stakeholders. It’s a win-win situation for becoming increasingly crucial as ESG considerations take center stage in the business world.

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