Sustainability Reporting Increasing Among S&P 500 Companies
According to a June report by the Governance & Accountability Institute (“the Institute”), sustainability reporting among companies in the Standard & Poor’s 500 (“S&P 500”) is growing at a staggering rate. Through the Institute’s research, it was discovered that 72 percent of S&P 500 companies submitted reports last year covering environmental, social and governance (ESG) matters. The number marks a 19-percent increase (53 percent) from 2012.
By these numbers, the Institute’s research concluded that corporate sustainability disclosure is a major concern for companies, especially in the eyes of investors and stakeholders. The report’s findings also noticed a strong link between sustainability reporting, and its effects on a company’s reputation and valuation when it discloses such information, as opposed to a company that does not.
Further, with the Global Reporting Initiative (GRI) framework being the standard most large-cap multinational companies use, research included over 1,200 companies that utilize the framework. While it was determined that the U.S. has the highest number of companies releasing GRI reports, the Institute learned that the country falls behind other nations in terms of total possible reporters for ESG reporting.
Based on its research, the Institute hopes to help companies improve upon identifying certain sustainability reporting issues. By doing so, management can focus on creating new opportunities for the organization, and its stakeholders and investors. The Institute also advised publishers and readers of corporate sustainability reports of potential disclosure overload. Excess of disclosures could make it difficult for investors and other readers to find information relevant to them.
For more the news release on sustainability reporting, click here.