A bird’s eye view on reporting regulations and the SDGs

Our latest podcast examines new disclosure expectations for businesses

It is no secret that sustainability reporting regulatory shifts and changes can make it challenging for companies to keep up to date. But how can businesses get down to the nuts and bolts of incoming disclosure requirements and have an overview of the key regulations that affect what and how they report? 

The final episode of series two of The SDG Insider – a podcast from GRI that bridges the gap between corporate reporting and the Sustainable Development Goals (SDGs) - explores the intersection of impact reporting with regulations, all the while taking stock of GRI’s position as the most widely used voluntary reporting framework globally.  

Episode 6: Navigating sustainability reporting in the age of regulatory revolution 

In this episode we hear from: 

• Bastian Buck, GRI’s Chief Standards Officer 
• Diego Herrera, Financial Markets Lead Specialist at the Interamerican Development Bank 
• Alyssa Rade, Chief Sustainability Officer at Sustain.Life 
• Maximilian Müller, Professor of Financial Accounting, the University of Cologne 

Together, they shed light on how companies can better adapt to regulatory changes, with a focus on the challenges and opportunities of sustainability data and links with the SDGs. 

A recap of insights shared 

According to the KPMG Survey of Sustainability Reporting, the GRI Standards are the most dominant globally. An overwhelming 96% of the world’s 250 largest companies by revenue (G250) report on their sustainability impacts, with 78% using the GRI framework. However, the survey also revealed that 36% of the G250 do not yet report on climate, and less than half disclose their social and governance risks. 

To date, the most far-reaching mandatory sustainability reporting requirements come from the European Union, with the Corporate Sustainability Reporting Directive (CSRD) in effect for over 50,000 EU businesses from 2024. Meanwhile, the IFRS Foundation has launched Sustainability Disclosure Standards that focus on how companies can incorporate sustainability-related risks and opportunities alongside financial reporting. 

With changes in human rights due diligence laws around the world, including the EU Corporate Sustainability Due Diligence Directive (CSDDD) and similar initiatives in Australia, Brazil and South Korea, businesses are increasingly required to identify and manage and publicly report their human rights-related impacts.  

The effect of these new regulations is already being felt by businesses of all sizes. For instance, many companies outside of the EU are faced with requests to provide sustainability data to their buyers in the European market. At the same time, in several countries, the new IFRS Climate-related Disclosures in the financial sector are resulting in sustainability risk assessments being incorporated into wider corporate strategy and governance. And for small and medium-sized enterprises (SMEs) seeking access to financial markets, disclosure requirements are also becoming more stringent. 

These new reporting requirements and frameworks also affect the ESG rankers and raters. For instance, a recent German study revealed a mere 10% convergence between an ESG rating methodology and data points in the European Sustainability Reporting Standards (ESRS) under CSRD. The widespread adoption of the ESRS will likely result in more pressure to consider the EU Sustainability Standards’ data points when rating businesses on their sustainability performance.

GRI has been working with both IFRS Foundation’s International Sustainability Standards Board (ISSB) and the European Financial Reporting Advisory Group (EFRAG) - the body responsible for the ESRS - to achieve greater alignment in the reporting landscape for the benefit of companies, investors, and society at large.   

The GRI Academy also provides training courses for sustainability professionals to help decode the sustainability reporting landscape and meet the ESRS reporting requirements.  

The SDG Insider can also be accessed on Spotify, Apple podcast, and Google podcast. GRI would like to thank the Government of Sweden for supporting this project through the Swedish International Development Cooperation Agency (Sida).