Policy & Regulation
Governments and regulators have a direct interest in sustainability reporting – it can help markets function more efficiently, and drive progress towards sustainable development goals. An increasing amount of policy and regulation promotes sustainability reporting.
Sustainability Reporting Policies and Regulation
Governments and market regulators play a multi-faceted role in promoting sustainability reporting. They do not just regulate private entities - they are also expected to lead by example regarding their own transparency on financial and non-financial performance.
State-owned companies may be asked to report their sustainability performance, as in Sweden and China. Public agencies are increasingly reporting their sustainability performance, and are asking their suppliers to do the same through sustainable procurement practices and policies. Transparency on environmental, social, and governance factors also comes into play when governments act as investors or investment managers.
Governments and market regulators can also promote a culture of transparency, stimulating public debate. They are positioned to invite business to support specific initiatives and activities, promote and support research, build practical capacity, enter into public-private partnerships, and promote and support multi-stakeholder initiatives.
The United Nations Conference on Sustainable Development - Rio+20 – was an outstanding example of making sustainability reporting top of the agenda. Paragraph 47 of the Rio+20 outcome document, The Future We Want, addresses the importance of sustainability reporting and recognizes the role of Governments in promoting it. Four Governments formed the Group of Friends of Paragraph 47, leading the implementation of the paragraph.
Around the world an increasing number of governments and market regulators are adopting policies and regulation for sustainability reporting. Please contact GRI if you’d like to contribute to the overview.
Sustainability reporting is relevant for governments, as it:
• Helps them to understand what companies within their jurisdictions are doing with regard to their environmental and social impacts
• Helps them to assess how companies are contributing to national sustainability efforts
• Creates transparency
• Creates dialogue between companies and other stakeholders, including governments
• Makes it possible to hold companies accountable for the impacts of their activities
Sustainability reporting is therefore a vital first step for managing change towards a sustainable global economy, promoting transparency and clear understanding of national sustainable development efforts.