How to report on the SDGs

by Karen McWilliams

Main points:

  • The Senate Inquiry into Sustainable Development Goals (SDGs) has published 18 recommendations for Australia
  • The Corporate Reporting Dialogue have released a position paper supporting the development of better reporting guidelines for the SDGs
  • Corporate reporting is key to providing the transparency needed to assess progress against the SDGs in a meaningful way

The United Nations Sustainable Development Goals (SDGs) are part of the 2030 Agenda and were adopted by Australia in 2015. In December 2017, the Senate referred SDGs to the Foreign Affairs, Defence and Trade References Committee for inquiry and to report back by November 2018.

Chartered Accountants ANZ lodged its submission to the Australian Senate Inquiry into the United Nations SDGs in early 2018. In it, we noted the lack of awareness of the SDGs among the Australian community and the important role of the Australian Government in communicating the value of the SDGs to the wider Australian Community.

In February 2019, the Inquiry released a 190 page report outlining 18 recommendations as a result of the extensive inquiry. The recommendations include the publication of a national SDG Implementation plan and an indicators based assessment every 2 years tracking Australia’s performance against the SDGs. The committee also recommends that the Australian Government partner with private and tertiary sector stakeholders to develop and disseminate Australian guidance to ensure consistent and transparent reporting and minimise the reporting burden for businesses. The Inquiry also strongly recommends that the SDGs are integrated throughout the international development program and to prioritise the commitment to leave no one behind.

SDGs and the future of corporate reporting

Major international corporate reporting standard setters and framework providers have released a position paper supporting the development of better reporting guidelines for the Sustainable Development Goals (SDGs).

The Corporate Reporting Dialogue (CRD) brings together the major standard setters and framework providers internationally. The Dialogue works together to provide guidance and structure for businesses to be transparent, accountable and to ensure better decision-making that promotes financial stability and sustainable development.
The primary purpose of the Dialogue is to promote greater coherence, consistency and comparability between corporate reporting frameworks and to this end it look for cooperation and alignment between key international standard setters and framework developers. The paper was prepared by Corporate Reporting Dialogue participants: CDP, Climate Disclosure Standards Board, Global Reporting Initiative, International Integrated Reporting Council, International Organization for Standardization and Sustainability Accounting Standards Board.

The paper notes the increasing recognition that companies’ value creation goes beyond financial value to include environmental and social value amongst others. Further developments support the increasing focus on integration of financial and non- financial information to demonstrate how companies create value for stakeholders over the short and long-term.

Sustainable development and financial stability are mutually dependent dimensions of a sustainable, inclusive economy: a stable financial system forms the basis for sound economic development and is a prerequisite for sustainable environmental and social outcomes. In other words, society will not allocate financial capital to achieve environmental and social outcomes when the basic condition of a stable economy is not met.

The paper notes that, collectively, CRD participants are collectively able to address all SDGs. It includes a table that shows which SDGs are addressed by each of the Dialogue participants’ frameworks at the level of topics and/or indicators.

Sustainable development and financial stability are mutually dependent dimensions of a sustainable, inclusive economy.

Better Alignment Project

At the 2018 World Congress of Accountants, the CRD announced the Better Alignment Project, a two-year project focused on driving better alignment in the corporate reporting landscape to make it easier for companies to prepare effective and coherent disclosures that meet the information needs of capital markets and society.

Participants of the CRD have launched a six-week global consultation process on Wednesday 20 March 2019, to gather views from stakeholders on how to drive better alignment of sustainability reporting frameworks, as well as with frameworks that promote integration between non-financial and financial reporting.

Through an online survey and a series of global roundtables, stakeholders will be consulted on how to support effective disclosures, addressing the Task Force for Climate-related Financial Disclosures (TCFD) recommendations, and identifying how non-financial metrics relate to financial outcomes and how this can be integrated in mainstream reports.

Information gathered from the consultation period will inform an initial report due for publication in September 2019, showing the linkages of the TCFD recommendations with the respective frameworks and the linkages between the frameworks. It will also inform potential areas for Corporate Reporting Dialogue participants to focus on going forwards as we drive better alignment.

Complete the Better Alignment Survey

Survey opened on 20 March. Take the survey.

Contribute to SDG research

Professors Carol Adams CA and Subhash Abhayawansa CA from Swinburne Business School are conducting research into how the accounting and finance function could be, or are, engaging with the SDGs. They have interviewed a number of senior management personnel from large companies and investor organisations.

Their study is intended to shed light on how companies and investors are engaging with the SDGs and the accounting, accountability and finance implications of an SDG focus. The findings will inform future directions for the accounting and finance function within organisations, accounting professional bodies and their members so that they are ready to help organisations integrate sustainability risks and opportunities into their strategies and business models. If you would like to take part in the research you can make contact here. Your participation will be confidential.

Karen McWilliams

This article was first published by CAANZ here and is republished with permission. Karen McWilliams is Business Reform Leader, Chartered Accountants of Australia and New Zealand

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