Embedded Files
Greenhouse Gas (GHG) Inventory • GHG Protocol • EU CBAM Declaration • Product Carbon Footprint (PCF) Report • ESG Sustainability Report / IFRS (S1, S2
Analysis of ESG sustainability report structure and model
A. ESG connotation and general practices
I .ESG Sustainability Report (Governance Unit Status)
1. Sustainability Governance Organization
Introduce the role and importance of sustainability governance organizations.
Explain how sustainability governance institutions influence the organization's sustainability strategy and practices.
2. The Sustainability Committee
Explains the composition, responsibilities, and role of the Sustainability Committee in promoting sustainable development.
Describe how the Sustainability Committee assists governance bodies in developing and implementing sustainability strategies.
3. Due diligence of governance institutions
Introduce in detail the sustainability factors that governance institutions should consider when conducting due diligence.
Explain how due diligence can help identify sustainability risks and opportunities.
4. Selection and Selection of Governance Units
Introduce the standards and procedures for the selection and selection of governance units.
Explain how to ensure that members of the governance unit have relevant sustainability expertise and experience through the selection process.
Each section should provide in-depth analysis and case studies to help readers understand how these concepts apply in real-world situations. Additionally, these instructions can be enhanced with diagrams, flowcharts, or other visual aids to make the content more vivid and understandable.
ESG governance organization
Nomination and selection of ESG governance institutions
governance structure due diligence
II .ESG Sustainability Report (Compilation of 3 Concepts)
1. GRI Standards (Global Reporting Initiative Guidelines)
The GRI Standards are a set of internationally widely recognized standards designed to help organizations report comprehensively on their economic, environmental, and social impacts. These guidelines provide a framework for organizations to publicly disclose their contributions and challenges to sustainability in a standardized manner. The GRI Standards emphasize non-financial qualitative descriptions, including but not limited to labor practices, human rights impacts, environmental protection measures, and anti-corruption initiatives.
At its core, GRI Standards revolve around their multi-stakeholder engagement process, ensuring that these guidelines meet the needs of all parties facing CSR reporting. The GRI reporting framework includes three broad categories of standards: generic, topic-specific (e.g., environmental, labor practices), and industry-specific standards, designed to provide comprehensive sustainability performance evaluations.
GRI is one of the most widely adopted sustainability reporting frameworks, and many businesses choose to use GRI guidelines for sustainability reporting because it provides a comprehensive set of guidelines for reporting economic, environmental, and social performance.
2. SASB Standards (Sustainability Accounting Standards Board Standards)
The SASB Standards focus on providing industry-specific quantitative metrics to help businesses identify, report, and manage sustainability issues that have a significant impact on their business. These guidelines aim to meet investors' demand for corporate sustainability information, emphasizing sustainability factors such as energy efficiency, emission reduction, and employee health and safety.
The SASB Code covers 77 industries, each with a unique set of criteria that indicate which sustainability issues are most important to investors. In this way, SASB guidelines help companies conduct targeted reporting and facilitate effective communication between investors and companies on sustainability issues.
SASB provides industry-specific standards to help companies disclose sustainability information about financial materials. The adoption rate of SASB has grown significantly in recent years, especially in the context of increasing investor demand for corporate sustainability information.
3. TCFD Framework (Task Force on Climate-related Financial Disclosures Framework)
The TCFD framework was initiated by the Financial Stability Board (FSB) to encourage companies to assess and disclose the financial impacts of climate change on their businesses. The TCFD proposes four major recommended areas: governance, strategy, risk management, and metrics and goals. These areas cover how companies should integrate climate-related risks and opportunities into their operations, strategic planning, and risk management processes.
The TCFD emphasizes quantitative analysis of climate finance, including the impact of potential climate-related risks and opportunities on corporate financial health, operating results, and cash flow. Through this analysis, businesses can better report their climate-related financial risks and opportunities to investors and other stakeholders, leading to increased transparency and the promotion of more responsible investment decisions.
TCFD focuses on the financial impact of climate change on businesses, and its adoption rate is increasing year by year, especially in financial services and high-carbon emitting industries.
In conclusion, the GRI Standards provide a comprehensive framework for non-financial qualitative reporting, with the SASB Standards focusing on industry-specific quantitative sustainability metrics and the TCFD Framework focusing on assessing and disclosing the impact of climate change on corporate finances. Each of these three sets of standards has its own focus and collectively promotes the progress and standardization of global sustainability reporting.
The sustainability report compiles three major concepts
ESG Sustainability Report is the current international reporting framework
ESG international corporate reports use the proportion of standard usage
III .ESG Sustainability Reporting GRI Standards (Global Reporting Initiative) framework
The GRI Guidelines (Global Reporting Initiative) are a set of internationally recognized standards used to guide businesses and organizations in sustainability reporting. The GRI Standards are divided into three main categories: generic, industry, and topic-specific guidelines, designed to help organizations report comprehensively on their economic, environmental, and social performance.
1. General Guidelines
The General Guidelines provide guidance on reporting principles and reporting practices and are applicable to all organizations and industries. They include:
GRI 101: Fundamentals - Introduce the principles and basic concepts of GRI reporting, including the purpose of the report and how to use the GRI Guidelines.
GRI 102: General Disclosure - Requires organizations to provide basic information about their organizational profile, governance structure, strategy, ethics, and integrity.
GRI 103: Management Methodology - Guides organizations on how to report on their management approach to important topics, including the components of the management methodology, how to evaluate, select, and manage these topics.
2. Industry Guidelines :
Industry guidelines provide more detailed guidance on industry-specific issues. These guidelines help organizations identify and report on sustainability issues that have the greatest impact on their industry. GRI does not currently publish industry guidelines numbered "GRI 11-18". Instead, GRI provides guidance and recommendations for multiple industry focuses to help organizations report based on the needs of their specific industry.
3. Topic-Specific Guidelines
Specific Topic Guidelines focus on specific economic, environmental, or social topics, providing specific guidance on how to report on these topics. These guidelines include:
GRI 201: Economic Performance - Covers the economic performance of an organization, including the generation and distribution of direct economic value.
GRI 202: Market Presence - deals with the impact of an organization on its suppliers, products and services, and other market participants.
GRI 203: Indirect Economic Impacts - Includes the indirect impacts of organizational activities on economic systems, such as economic development, impacts on employment and skills development, etc.
GRI 204: Procurement Practices - Focuses on how an organization's procurement decisions affect the sustainability and socioeconomic conditions of the supply chain.
GRI 205: Anti-Corruption – Disclose how organizations identify, assess, and respond to corruption risks they may encounter in their operations, including policies, training, and risk assessment processes implemented.
4. Environmental Series (GRI 300 Series)
GRI 303: Water and Wastewater - Discloses the management and use of water resources by organizations, including water withdrawal, discharge, and recycling.
GRI 304: Biodiversity - Disclose the impact of the organization's activities on biodiversity, including impacts on protected areas and areas of high biodiversity value.
GRI 305: Greenhouse Gas Emissions - Disclose an organization's greenhouse gas emissions, including direct and indirect emissions, as well as mitigation strategies and outcomes.
5. Social Series (GRI 400 Series)
GRI 401: Employment - Discloses an organization's employment practices, including employee recruitment, promotion, conditions for terminating contracts, and work-family life balance.
GRI 402: Labor/Management Relations - Disclosure of communication and consultation mechanisms between the organization and employees, including labor negotiations.
GRI 403: Occupational Health and Safety - Disclose the organization's efforts and effectiveness in ensuring health and safety in the workplace, including accidents and occupational disease rates.
GRI 404: Training and Education - Disclose the organization's policies, procedures, and effectiveness in training and developing employees, including average annual training hours and types of training.
GRI 405: Diversity and Equal Opportunity - Disclose organizational practices in promoting diversity and achieving equal opportunities in the workplace, including employee composition and pay disparities.
Additionally, there are many other topic-specific guidelines, such as the GRI 300 Series (Environment) and GRI 400 Series (Society), covering a wide range of topics from emissions, water resources, and biodiversity to labor practices, human rights, and social impact.
The GRI Guidelines aim to provide a comprehensive framework to help organizations disclose their economic, environmental, and social impacts and performance, thereby supporting the Global Sustainable Development Goals. These guidelines are continuously updated and revised to reflect the latest developments and best practices in the field of sustainability reporting.
Please note that the GRI Code is constantly updated and revised to reflect the latest sustainability trends and best practices. Therefore, it is recommended to visit GRI's official website for the latest guidelines and guidelines.
GRI Standards (Global Reporting Initiative) framework
IV .ESG Sustainability Reporting SASB (Sustainability Accounting Standards Board) framework
The SASB Standards Board (Sustainability Accounting Standards Board) aims to provide investors and companies with standards for the identification, management, and reporting of financial material sustainability information. The SASB Standards focus on sustainability issues that can have a significant impact on a company's financial health or operational performance, and these are divided into three categories: environmental, social, and corporate governance.
1. Environmental Issues
The environmental dimension covers the impact of corporate activities on the natural environment, including but not limited to the following aspects:
Climate Change: Involves the company's greenhouse gas emissions, carbon asset risks, and energy management, as well as how companies respond to the impact of climate change on their business models.
Resource Management: Includes water resource management, waste management, and raw material sourcing strategies, focusing on how businesses can effectively utilize natural resources and reduce their environmental footprint.
Biodiversity and Ecosystem Services: Assessing the impact of corporate activities on biodiversity, including land use, ecosystem impacts, and species conservation.
2. Social responsibility
The social dimension focuses on the impact of enterprises on human society, mainly including:
Human capital: involves employee health and safety, labor practices, employee development and welfare, etc., and focuses on how enterprises manage and invest in their employees.
Product Responsibility: Includes product quality and safety, customer privacy and data security, and product life cycle impacts, focusing on how companies ensure that their products and services are responsible to consumers and society.
Community Relations: Evaluating the relationship between businesses and the communities in which they operate, including community investments, public policy impact, and social impact assessments.
3. Corporate Governance
The corporate governance dimension covers corporate governance structures and practices, and its impact on sustainability strategies and risk management, mainly including:
Governance structure: involves the composition, role, and diversity of the board of directors, as well as the board's supervision and management of sustainability issues.
Business Ethics and Competitive Conduct: Includes anti-corruption, anti-competitive behavior, and business ethics standards, focusing on how businesses maintain their reputation and legitimacy through ethical behavior.
Risk Management: Assessing how a business identifies, assesses, and manages sustainability risks, including environmental, social, and governance risks, and the impact of these risks on a business's financial performance.
The SASB Code helps companies identify and report on sustainability issues that have a financial material impact on their business by providing industry-specific standards. These standards aim to enhance transparency and consistency in corporate sustainability reporting, thereby supporting investors and other stakeholders in making more informed decisions.
SASB Standards (Sustainability Accounting Standards Board) framework
SASB Standards 77 Industries (Mind Map)
ESG Sustainability Report (SDGs) 17 Sustainable Development Goals of the United Nations
V .ESG Sustainability Report (Third-Party Conviction AA1000 Accountability Assurance Principle)
The AA1000 Accountability Principles are a set of principles developed by the AccountAbility organization to guide organizations on how to more responsibly identify, understand, and respond to sustainability reporting issues. This set of principles specifically emphasizes four key areas: Impact, Inclusivity, Materiality, and Responsiveness. Here are the specifics of these principles:
1. Impact :
Definition:Impact principles require organizations to identify, evaluate, and manage the economic, environmental, and social impacts of their decisions and activities.
Specifics:
Organizations need to assess the direct and indirect impact of their operations and strategies on stakeholders and the environment.
Effective management and mitigation measures should be developed to reduce negative impacts and enhance positive impacts.
These impacts need to be regularly monitored and evaluated, and strategies and practices adjusted based on the assessment results.
2. Inclusivity
Definition: Inclusivity principles emphasize that organizations should actively interact with their stakeholders, enabling them to participate in decision-making processes, especially those directly affected by the organization's activities.
Specifics:
Organizations need to identify and engage in dialogue with their stakeholders to understand their expectations and needs.
Transparent and open communication channels should be established to encourage feedback from stakeholders.
Diverse perspectives and cultures need to be respected, ensuring that all stakeholders have the opportunity to be heard.
3. Materiality
Definition: The materiality principle requires organizations to identify and focus on the sustainability issues that matter most to their business and stakeholders.
Specifics:
Organizations need to conduct a materiality assessment to determine which sustainability issues are most critical to the organization and its stakeholders.
The potential impact of these issues on the organization's strategy, operations, and stakeholders should be considered.
Materiality issues need to be reassessed regularly to reflect changes in the internal and external environment.
4. Responsiveness :
Definition:The principle of responsiveness requires organizations to respond to the expectations and needs of stakeholders and transparently report on their decisions, actions, and performance.
Specifics:
Organizations need to respond promptly and appropriately to stakeholder concerns and inquiries.
It should transparently disclose in its sustainability reports how it handles and responds to material sustainability issues.
It is necessary to demonstrate how the organization adapts its strategies and practices based on stakeholder feedback.
Together, these principles form a framework that helps organizations approach sustainability reporting in a more accountable and transparent manner, as well as fostering effective communication and engagement with stakeholders. By implementing AA1000 principles, organizations can improve their sustainability performance and build trust and credibility among their stakeholders.
ESG Sustainability Report AA1000 Principles of Accountability Assurance (Third-Party Assurance)
B. Regulations for the Preparation and Reporting of Sustainability Reports
I .Sustainability Report Regulations (Development History of Report Compilation Specifications)
As of April 2023, the specific "Operational Measures for the Preparation and Filing of Sustainability Reports by Listed Companies" and the details of its development history may vary depending on the region and regulatory authority. However, the development history of Taiwan's sustainability report compilation standards and the general framework for the preparation and filing of sustainability reports by listed companies.
A. Sustainability Report Compilation Specification
1.Early Stages of Development:
Initially, sustainability reports were primarily published voluntarily by a small number of companies with a high commitment to environmental and social responsibility. These reports mostly focus on environmental protection measures and social contribution activities.
2.Standardization and Framework Development:
As global concerns about sustainability and corporate social responsibility increase, many organizations and institutions have begun to develop sustainability reporting standards and frameworks, such as the Global Reporting Initiative (GRI), the International Integrated Reporting Board (IIRC), and the Sustainability Accounting Standards Board (SASB), etc., to promote consistency and comparability in reporting.
3.Regulatory requirements and policy support:
With the increasing awareness of sustainable development issues, many countries and regions have begun to pass laws and policies requiring listed companies to conduct sustainability reporting. For example, the European Union's Non-Financial Reporting Directive (NFRD) requires large companies to disclose specific non-financial information.
4. Integration and Development Trends:
In recent years, sustainability reporting has tended to be integrated with financial reporting, emphasizing the impact of sustainability issues on the long-term value of businesses. Integrated reporting has become a trend to provide a more comprehensive story of corporate value creation.
B.General framework for the preparation and reporting of sustainability reports by listed companies
1.Reporting Principles:
Ensure transparency, accuracy, completeness, consistency, and comparability of reports. Reports should be based on material-based principles to identify and focus on sustainability issues that are most important to the company and its stakeholders.
2. Report content:
Typically includes aspects such as corporate governance, environmental protection, social responsibility, and employee relations. The specific content should be adjusted according to the business characteristics of the enterprise and the concerns of stakeholders.
3.Data Collection and Management:
Establish effective data collection and management systems to support the accuracy and completeness of sustainability reporting.
4.Stakeholder Engagement:
Understand stakeholders' expectations and concerns through communication and engagement, and consider them during the reporting process.
5. Report Review and Assurance:
Conduct internal or third-party report audits and assurance to increase the credibility of the report.
6. Continuous Improvement:
Continuously improve sustainability performance and reporting practices based on reporting results and stakeholder feedback.
Please note that specific operating methods and requirements may vary based on the laws and regulations of different countries and regions, as well as the guidance of relevant regulatory agencies. Therefore, listed companies should refer to local laws, regulations and industry best practices when compiling and reporting sustainability reports.
Sustainability Report Regulations Development History of Report Compilation Standards/Source: Regulations for the Preparation and Filing of Sustainability Reports by Listed Companies
Sustainability Report Regulations Taiwan Sustainability Report Disclosure Framework/Source: Regulations for Listed Companies to Prepare and Report Sustainability Reports
Article 3 of the Regulations
• Refer to the GRI Standards, Industry
• Disclosures, and Industry Characteristics issued by GRI on an annual basis, and disclose material economic, environmental, and social themes, management policies, disclosure items, and reporting requirements identified by the company, and at least comply with the core options of the Standards.
•Listed companies should disclose in the corporate social responsibility report the content index corresponding to the GRI standards, and indicate whether each disclosure item has been confirmed, assured or guaranteed by a third party in the report.
Sustainability Report Regulations How to Prepare Reports in accordance with GRI Standards/Source: Regulations for Listed Companies to Prepare and File Sustainability Reports
Article 3 of the Regulations
• Listed companies shall prepare the corporate social responsibility report for the previous year annually with reference to the GRI standards issued by the Global Sustainability Reporting Initiatives (GRI), industry disclosures, and other applicable standards based on industry characteristics, disclosing the major economic, environmental, and social themes, management policies, disclosure items, and reporting requirements identified by the company, and shall at least comply with the core options of the GRI Standards.
Sustainability Report Regulations GRI Regulations for the Preparation of Sustainability Reports/Source: Regulations for the Preparation and Filing of Sustainability Reports by Listed Companies
Operational Measures for Sustainability Reports Operational Regulations Operational Regulations Article 3 Core Options Review Points (Yes/None)/Source: Operational Regulations for Listed Companies Preparing and Reporting Sustainability Reports
II .Sustainability Report Practices (GRI 3: Material Topics 2021 Identification Procedures)
The material subject identification process in the GRI standards is a critical process designed to help organizations identify and assess the sustainability issues that matter most to their business and its stakeholders. This process is typically included in GRI 101: Foundational Standards and is further elaborated and applied in updated versions of the GRI standards. Here are the general steps and connotations of conducting a material subject identification process based on the GRI standards, especially for the 2021 update, if any:
1. Preparation Stage
Organizational Commitment: Ensure support and commitment from organizational leadership.
Project Scope and Plan: Define the scope of the material topic identification and selection process, including timeframes, scopes, and resources.
2. Identify potential material topics and gather information:
Gather information through internal and external resources, including industry trends, legal and regulatory requirements, stakeholder expectations, etc.
List potential topics: Based on the information gathered, list all sustainability issues that could impact the organization and its stakeholders.
3. Stakeholder Engagement:
Identify stakeholders: Identify which stakeholders have a significant impact or concern on the organization's sustainability performance.
Engagement Process: Engage with stakeholders through surveys, interviews, workshops, etc., to gather their views and concerns on potentially significant topics.
4. Assess Material Topics Assess Impact:
Assess the extent and scope of each potential topic on the organization and its stakeholders.
Determine materiality: Based on an impact assessment, determine which topics are most important to the organization and stakeholders.
5. Prioritization and Selection Prioritization:
Sort the topics identified as significant to determine which ones are most critical.
Select Report Topics: Based on prioritized results, select topics that will be reported in detail in the Sustainability Report.
6. Verification and Audit
Internal Verification: Ensure the integrity and accuracy of the identification process through an internal audit process.
External Assurance (Optional): Access assurances from external experts or third parties to add transparency and credibility to the process.
7. Report and communicate
Results: Clearly report the material topic identification process and results in the sustainability report, including the selection of topics for the report and the rationale for exclusion.
Stakeholder Feedback: Provide stakeholders with opportunities to report and seek their feedback on the content of the report.
8. Continuous Improvement
Evaluation and Reflection: Regularly evaluate the effectiveness of the material topic identification process and make adjustments based on new information and stakeholder feedback.
Please note that the above steps and content may be adjusted based on the specific circumstances of the organization and the latest version of the GRI standards. It is recommended to refer to GRI's official documentation and resources for the most accurate and up-to-date guidance information.
Sustainability Reporting Practices GRI 3: Material Topics 2021 Identification Procedure/Source: Global Reporting Initiative
Sustainability Report Regulations Disclosure Issues by Industry/Source: Regulations for Listed Companies Preparing and Filing Sustainability Reports
Regulations Governing the Implementation of Sustainability Reports with paid-in capital of NT$2 billion or more will be applied from 2024 (Appendix 1) / Source: Article 4, Paragraph 3 of the Regulations Governing the Preparation and Filing of Sustainability Reports by Listed Companies : Strengthen the disclosure of sustainability indicators by industry
Regulations Governing the Practice of Sustainability Reports Climate-related Information of TPEx Listed Companies (Appendix 2)/Source: Regulations Governing the Preparation and Filing of Sustainability Reports by Listed Companies
Article 4-1 of the Regulations Governing the Risks and Opportunities Caused by Climate Change to the Company and the Relevant Response Measures Taken by the Company : Listed companies under Article 2 shall disclose climate-related information in a special chapter. (Annex 2)
Sustainability Reporting RegulationsIFRS Sustainability Disclosure Standards-S1 Sustainability-related Financial Disclosures (General Requirements) / Source: Financial Supervisory Commission
The Financial Supervisory Commission issued the 2026 Direct Adoption of IFRS Sustainability Disclosure Standards
1. 2026: Applicable to listed and OTC companies with a capital of more than 10 billion yuan.
2. 2027: Applicable to listed and OTC companies with a capital of more than NT$5 billion but less than NT$10 billion.
3. 2028: Applicable to all other listed companies.
Sustainability Reporting RegulationsIFRS Sustainability Disclosure Standards-S2 Climate-related Disclosures (Climate Disclosure Requirements) / Source: Financial Supervisory Commission
The Financial Supervisory Commission issued the 2026 Direct Adoption of IFRS Sustainability Disclosure Standards
1. 2026: Applicable to listed and OTC companies with a capital of more than 10 billion yuan.
2. 2027: Applicable to listed and OTC companies with a capital of more than NT$5 billion but less than NT$10 billion.
3. 2028: Applicable to all other listed companies.
Regulations for Sustainability Report Confirmation of Sustainability Report Audit Procedures/Source: Regulations for the Preparation and Filing of Sustainability Reports by Listed Companies
Article 3 of the Operational Regulations
C. Bu-Zhen low-carbon strategy counseling operation mode
ESG Strategy Counseling Model Completes the Four Major Processes of Counseling (Reporting) / Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
ESG Strategy Counseling Model Completion Counseling Progress Estimate and Gantt Chart/Source: Compilation by Bu-Jhen Low Carbon Strategy Co., Ltd
4 Steps for Identifying Major Topics in the ESG Strategy Counseling Model / Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
ESG Strategy Counseling Model 5 Key Steps for Material Theme Approval/Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
ESG Strategy Coaching Model Climate-related Risk Meeting Target Indicators 4 Management Processes/Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
ESG Strategy Counseling Model Questionnaire and Impact Degree Matrix (Performance)/Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
ESG Strategy Counseling Model Sustainability Committee Internal Key Issues Reporting Operation/Source: Compiled by Bu-Jhen Low Carbon Strategy Co., Ltd
What are IFRs? Do I need to consider IFRs requirements or regulations when writing ESG sustainability reports? What does it relate to climate-related disclosures?
International Financial Reporting Standards (IFRS) is a set of financial reporting standards established by the International Accounting Standards Board (IASB). These guidelines are designed to provide consistent, transparent, and comparable financial information, helping investors, lenders, and other market participants make informed economic decisions. IFRS covers a wide range of financial reporting areas, including financial condition, operating results, and cash flow.
IFRS considerations in writing ESG sustainability reports
Traditionally, IFRS primarily focused on financial reporting, while ESG sustainability reports focused on a company's environmental, social, and governance (ESG) performance. However, with the increasing global focus on sustainability and responsible investing, the boundaries between financial reporting and ESG reporting are gradually blurring. When writing ESG sustainability reports, companies do need to consider IFRS requirements or regulations, especially in the following aspects :
1. Integrated Reporting:
Integrated reporting is a reporting method that combines financial and non-financial information, including ESG factors, to provide a more comprehensive view of a company's value creation process. The IFRS Foundation supports the development of integrated reporting, which means that when writing ESG reports, consideration should be given to how this information can be combined with financial data to more fully reflect the performance and prospects of the company.
2. IFRS Sustainability Reporting Standards:
The International Sustainability Standards Board (ISSB), a subsidiary of the International Accounting Standards Board (IASB), is developing a range of sustainability reporting standards, including IFRS S1 "General Requirements" and IFRS S2 "Climate-related Disclosures". These standards aim to improve the quality and consistency of sustainability reporting, enabling it to meet the needs of investors and other stakeholders. Therefore, when writing ESG reports, companies should pay attention to the requirements of these new standards and consider how to disclose according to these standards.
3. IFRS S1 and IFRS S2 Requirements
IFRS S1 and IFRS S2 are two important standards issued by the International Accounting Standards Board (IASB) specifically in the field of sustainability reporting. These standards aim to improve transparency, comparability, and consistency in corporate sustainability reporting to help investors and other stakeholders make more informed decisions. Here's a brief look at both criteria:
(1) IFRS S1: Sustainability Reporting - General Disclosure Requirements
IFRS S1 sets out the general requirements that companies should follow in their sustainability reporting, including reporting scope, reporting period, and reporting frequency. This standard requires companies to disclose information about their economic, environmental, and social impacts, as well as strategies and practices for managing these impacts. The aim is to ensure that the sustainability reports provided by the business are useful and credible to all stakeholders, especially investors.
(2) IFRS S2: Sustainability Reporting - Climate-related Disclosures Requirements
IFRS S2 focuses on climate-related financial disclosures, requiring companies to disclose the impact of their business on climate change and the impact of climate change on their business. This includes the company's greenhouse gas emissions, the energy sources used, and strategies in the face of climate change risks and opportunities. The standard is designed to help investors understand how businesses identify, assess, and manage risks and opportunities related to climate change. The introduction of these two standards marks a significant step towards more comprehensive disclosure in global financial reporting, including sustainability considerations. They encourage businesses to adopt more transparent and accountable reporting practices, thereby supporting the achievement of global sustainability goals. For academics and consultants focusing on sustainable net-zero, ESG sustainability strategies, and net-zero carbon emission issues, understanding and applying these standards is crucial for improving the quality of research and consulting services.
4. Risk management and disclosure:
IFRS requires companies to disclose risks related to their financial position, operating results, and cash flow in their financial reports. As ESG factors increasingly impact business operations, these risks are increasingly seen as factors that have a significant impact on financial performance. Therefore, when writing ESG reports, companies should consider the financial impact of these risks and disclose them accordingly according to IFRS requirements.
While IFRS has traditionally focused on financial reporting, in the current context of increasing global requirements for sustainability and transparency, companies do need to consider IFRS requirements or regulations when writing ESG sustainability reports. This not only helps improve the quality and credibility of reports, but also better meets the information needs of investors and other stakeholders.
How should the IFRS S1 "General Disclosure Standards" and IFRS S2 "Climate-related Disclosure Standards" under the ISSB identify material matters within the ESG sustainability report structure?
When preparing ESG sustainability reports, identifying material matters according to the IFRS S1 "General Disclosure Standards" and IFRS S2 "Climate-related Disclosure Standards" under the International Sustainability Standards Board (ISSB) is a critical step. These standards aim to enhance transparency and consistency in corporate sustainability reporting, particularly in environmental, social, and governance (ESG) reporting. Here are the guidelines for identifying material matters within the structure of an ESG sustainability report:
1. Understanding the definition of "materiality"
IFRS S1: Requires companies to disclose sustainability issues that have a significant impact on their business, business model, and strategy, including those that impact their ability to create value.
IFRS S2: Focuses on climate-related risks and opportunities, requiring companies to assess and disclose climate-related matters that have a significant impact on their financial health, operating results, or cash flows.
2. Conduct a stakeholder expectations and needs analysis
Identifying which sustainability issues are most critical for investors, customers, employees, and other stakeholders. This requires extensive stakeholder communication and engagement to ensure that the report meets their information needs.
3. Assess the Impact of Sustainability Issues :
Analyze how specific sustainability issues impact the business's business operations, financial performance, and long-term value creation. This includes considerations of factors such as climate change, resource scarcity, social justice, and governance practices.
4. Determine the materiality threshold (weighted number)
In order to identify material matters, enterprises need to set certain materiality thresholds, which should be evaluated based on the degree of impact on the company's business and strategic goals. This involves quantitative and qualitative evaluation methods.
5. Conduct a materiality assessment :
Use risk management and impact assessment tools to identify and assess sustainability issues that could have a significant impact on the business. This should be a dynamic process, regularly updated to reflect changes in the external environment and internal business models.
6. Disclosure Process and Results :
The ESG Sustainability Report clearly describes the process used to identify material sustainability issues, the materiality thresholds set, and how to assess the impact of these issues on the company. For sustainability issues identified as significant, detailed disclosures should be made of their specific impact on the business and management measures.
By following these guidelines, companies can effectively identify material matters in their ESG sustainability reports and make comprehensive and consistent disclosures in accordance with IFRS S1 and S2 requirements. This not only helps improve the quality and credibility of reports but also better meets the information needs of investors and other stakeholders, promoting sustainable corporate development.
If a company is included in the TCFD framework during the planning of ESG sustainability reports, how should S1 "General Requirements" and S2 "Climate-related Disclosures" be disclosed within the framework?
The disclosure requirements of IFRS S1 General Requirements and IFRS S2 Climate-related Disclosures, combined with the framework of the Task Force on Climate-related Financial Disclosures (TCFD), can provide companies with a comprehensive and consistent approach to climate-related financial disclosures. Here are the guiding principles for implementing IFRS S1 and IFRS S2 disclosures within the TCFD framework:
1. Understand the core elements of the TCFD
The TCFD framework is built on four main pillars: governance, strategy, risk management, and metrics and objectives. These pillars are designed to help organizations better understand and assess the impact of climate change on their business.
2. Integrated governance of IFRS S1 "General Requirements ":
Disclose the responsibility for supervision and management of climate-related issues within the organization. IFRS S1 requires companies to provide information about their governance structures, which can include how climate change issues are monitored.
Strategy: Describes the impact of climate change on an organization's business, strategy, and financial planning. IFRS S1 encourages companies to disclose their assessment of climate change impacts, including opportunities and risks.
Risk Management: Disclosure of how climate-related risks are identified, assessed, and managed. The general requirements of IFRS S1 cover a description of the risk management process, aligning with the TCFD's risk management pillars.
3. IFRS S2 "Climate-related Disclosures" Integrated
Indicators and Objectives: Use specific metrics and targets to measure and manage climate-related risks and opportunities. IFRS S2 focuses on climate-related financial disclosures, requiring companies to provide specific metrics such as greenhouse gas emissions data and financial impact assessments for climate-related risks. These requirements are directly related to the TCFD's indicators and target pillars.
4. Implementation Recommendations
Integrated Reporting: When preparing ESG reports or climate-related financial reports, companies should consider integrating the requirements of IFRS S1 and S2 with TCFD recommendations to form a unified reporting framework. This helps improve transparency and consistency in reporting while meeting the information needs of different stakeholders.
Continuous Communication: Companies should maintain open communication channels with their stakeholders, including investors, customers, and regulators, providing clear explanations on the scope, methodology, and results of their climate-related disclosures.
By combining the requirements of IFRS S1 and S2 with the TCFD framework, companies can not only meet the requirements of international financial reporting standards but also improve the quality and consistency of their climate-related financial disclosures on a global scale.
European Sustainability Reporting Standards (ESRS)
The European Sustainability Reporting Standards (ESRS) were developed by the European Financial Reporting Advisory Group (EFRAG) to strengthen corporate environmental, social and governance (ESG) disclosure requirements to support the EU's sustainable finance strategy. This set of guidelines aims to enhance transparency and consistency in reporting, enabling investors and other stakeholders to more effectively evaluate a company's sustainability performance.
Purpose and Scope of ESRS
The primary purpose of ESRS is to ensure that businesses provide comprehensive, consistent, and comparable ESG information. This includes detailed reports on the company's environmental impact, social responsibility, and governance practices. The guidelines apply to large corporations and listed companies registered in the EU, especially those with significant environmental and social impacts.
ESG Report Planning and Writing
Writing ESG reports that meet ESRS requirements are a step-by-step process that requires careful planning and preparation. Here are the detailed steps and recommendations:
1. Determine the scope and objectives of the report
First, companies need to determine the scope and objectives of ESG reporting. This includes determining the time frame, geographic scope, and business units that the report will cover. Companies should assess the environmental and social impact of their business activities and determine which ESG issues are most important to the company and its stakeholders.
2. Stakeholder Identification and Engagement
Effective ESG reporting requires considering the needs and expectations of different stakeholders. Businesses should identify their key stakeholders, such as employees, customers, suppliers, investors, and community members, and gather their views and concerns on ESG issues through surveys, interviews, or workshops.
3. Material Assessment
Material assessment is the process of determining which ESG issues are most important to a company and its stakeholders. This requires companies to assess the importance and impact of different ESG issues and determine the key content of the report based on these assessments. Material quality assessments should be conducted regularly to reflect changes in the external environment and corporate strategies.
4. Data collection and analysis:
Collecting and analyzing data related to material ESG issues is a critical step in writing a report. Businesses need to establish effective data collection systems to ensure that the information reported is accurate and reliable. This may include collecting operational data from internal systems, conducting employee and customer surveys, and collaborating with suppliers and other external stakeholders to gather data.
5. Set Goals and Strategies
Based on the evaluation of current performance and external requirements, companies should set specific goals and strategies for important ESG issues. This includes both short-term and long-term goals, as well as action plans to achieve them. Companies should clearly state how they can improve their ESG performance through management measures, technological innovation, and collaboration with stakeholders.
6. Writing Reports
When writing ESG reports, businesses should ensure that the content is clear, accurate, and consistent. The report should include executive summaries, performance data, success stories, and future plans, among others. Businesses should use charts, images, and other visual elements to enhance the readability and appeal of their reports. In addition, the report should include an in-depth analysis of key ESG issues and a description of how the company is managing these issues.
7. Verification and Disclosure
To enhance the credibility of ESG reporting, companies should consider conducting independent third-party verification. This can be done through forms such as environmental certifications, social audits, or governance assessments. After completing the report, businesses should make extensive disclosures through their official websites, annual reports, and other public channels to ensure that the information is easily accessible to different stakeholders.
Conclusion
Writing ESG reports in accordance with ESRS specifications is a complex but important process. By providing comprehensive, consistent, and comparable ESG information, companies can not only meet regulatory requirements but also enhance their attractiveness to investors and other stakeholders. As the global focus on sustainability continues to increase, businesses will increasingly need to showcase their efforts and achievements in environmental protection, social responsibility, and good governance. By following ESRS, businesses can take a solid step towards sustainability.
How should the ESG sustainability report be implemented, and stakeholders (relevant departments of the company, governance departments, and related supply chains) discuss major topics and questionnaires, design questionnaires, and select international frameworks?
I .Preparing an ESG sustainability report, especially for stakeholder discussions and opinion questionnaires, is an important step to ensure that your report reflects the company's actual ESG performance and meets stakeholder expectations. The following is a possible procedure that you can adjust according to your specific situation:
ESG sustainability report
ESG永續報告書與公司董事會權能、高階承諾管理、公司治理的重要關聯性分析 .mp41.Identify Stakeholders:
Identify all possible stakeholders, including relevant departments within the company, governance departments, and external supply chains and other stakeholders.
Categorize these stakeholders and determine their importance to the company's ESG issues.
2. Create a communication plan:
Create a communication plan that clearly outlines how you will communicate with various stakeholders, including how you will discuss topics and gather opinions.
3.Design a questionnaire or interview guide:
If the survey is conducted through questionnaires, ensure that the questions are specific, clear, and cover all aspects of ESG, such as environmental, social, and corporate governance.
If conducting face-to-face interviews, prepare a guide that ensures that every stakeholder has the opportunity to talk about ESG issues that they think are important.
4.Conduct Topic Discussions:
Schedule topic discussion sessions, which can be face-to-face, online, or utilize platforms for discussions.
Emphasize transparency and let participants understand how their opinions will impact the content of ESG reports.
5.Organize and Analyze Results:
Organize all collected data, ensuring input from different stakeholders is taken into account.
Conduct an analysis to identify important themes and trends.
6.Report Writing:
Integrate the results of thematic discussions and opinion questionnaires into ESG reports.
Highlight the company's actions and future plans in different ESG aspects.
7.Loop Feedback:
Provide draft reports to stakeholders for further input.
Consider continuous looping feedback mechanisms to ensure continuous improvement in the company's ESG reporting.
The above is a general guideline and the actual implementation may vary depending on the specific circumstances of the company. It is important to ensure transparency and participation in the process to ensure that stakeholder voices are fully reflected in ESG reporting.
II . Designing questionnaires on major topics is an important part of ensuring that you can obtain valuable and in-depth information. Here are some suggestions to help you design such a questionnaire:
1.Clearly define topics:
At the beginning of the survey, clearly define each topic, ensuring respondents understand the scope covered by these topics. Hierarchical Question Structure:
2.Hierarchical Problem Structure:
Hierarchize the problem structure, starting with the overall concept and refining it further. This helps respondents understand more easily and provide in-depth responses. Specific and Open-Ended Questions:
3.Specific and Open-Ended Questions:
Provide specific questions to gather details and a specific course of action. At the same time, it also gives respondents some open space to share their views and suggestions. Use various question types:
4.Use Various Question Types:
Integrate multiple question types, including single-choice, multiple-choice, sorted, and open-ended questions, for different types of feedback.
5.Avoid Double Negatives:
Ensure that questions are clear and avoid using double negatives to reduce confusion in responses.
6.Provide neutral options:
Provide neutral or indeterminate options in the options to ensure respondents can answer truthfully.
7.Consider Time Factors:
Pay attention to the length of the questionnaire to avoid lengthy questionnaires, which can lead to interviewee fatigue and affect the quality of the data.
8.Verify Question Clarity:
Before officially publishing the questionnaire, test a small group of subjects to ensure clarity and consistency in the questions.
9.Guidance and Supplementation:
Include guidance text in the questionnaire to explain the background and purpose of the question. At the same time, provide supplementary information to help respondents better understand the topic.
10.Diverse Respondents:
If possible, ensure that the questionnaire is tailored to different stakeholders (different departments within the company, suppliers, investors, etc.) to reflect their respective concerns.
11.Anonymity Protection
Protecting respondents' anonymity, especially if the questionnaire involves people within the company, can help in obtaining more candid responses.
These suggestions can be tailored to your specific ESG framework and company characteristics. When designing the questionnaire, continuously communicate with stakeholders to ensure that the question design meets their expectations and can effectively obtain information
II .How should the international framework for ESG sustainability documents be selected to specify the framework criteria for the company's ESG sustainability report?
Choosing the right framework and guidelines for a company's ESG (Environmental, Social, Governance) sustainability report is an important decision that can impact the report's content, comparability, and corporate image. Here are some tips to help you make an informed decision when choosing an international framework:
1.Understand Company Needs:
First, assess the company's specific needs and goals. Consider the company's industry, geography, size, and business model to ensure that the chosen framework adequately reflects the company's realities.
2.Explore Mainstream Frameworks:
Learn about key ESG frameworks such as the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), Task Force on Climate-related Financial Disclosures (TCFD), and more. These frameworks provide widely accepted standards that contribute to the comparability of reports.
3.Consider Industry Standards:
Some industries may have specific ESG standards and guidelines. Consider adopting a framework that aligns with best practices in your industry to ensure that the report meets the appropriate standards.
4.Engage in Conversations with Stakeholders:
Engage in conversations with your company's stakeholders, including investors, customers, employees, and more. Understand their concerns about ESG issues to ensure the report meets their expectations.
5.Consider investor needs:
Consider the company's investor base and whether there are specific investors who require specific ESG frameworks. Many investors are interested in transparency and standardized reporting.
6.Adapt to Regulatory Requirements: Consider local and international regulatory requirements. Some regions may have mandatory ESG reporting requirements, and specific frameworks may align with these regulations.
7.Internal Capabilities: Consider the company's internal capabilities and resources. Some frameworks may require additional resources for reporting, ensuring that the company can effectively navigate the chosen framework.
8.Integrated Risk Management: Consider whether the ESG framework can integrate risk management, especially those related to climate change. This is emphasized in frameworks such as the TCFD.
9.Follow Industry Leaders: Research and understand the frameworks used by leading companies in the industry. This can provide a reference, ensuring that the company is at the forefront of industry standards.
Selecting an ESG framework should be a process that considers various factors. Companies may need to integrate multiple frameworks to ensure comprehensive and in-depth ESG reporting. Additionally, regularly review the chosen framework to ensure it remains aligned with the company's needs and market standards.
Selecting an ESG framework should be a process that considers various factors. Companies may need to integrate multiple frameworks to ensure comprehensive and in-depth ESG reporting. Additionally, regularly review the chosen framework to ensure it remains aligned with the company's needs and market standards.
What is the relationship between SBTi science-based reduction targets and ESG strategies related to the environment
SBT科學減量目標與ESG策略有關環境Environmental 的關係為何.mp4SBTi and ESG relevance/video explanation
There is a strong correlation between SBTi (Science Based Targets) and ESG (Environmental, Social, Governance) strategies, especially in terms of the environment. SBTi is a scientific emission reduction method aimed at addressing climate change, by determining emission reduction targets and quantitative indicators and setting targets, committing, tracking results, and communicating greenhouse gas reduction performance with stakeholders, to ensure that the company's carbon emissions are based on the company's own stakeholders, global net-zero effectiveness and emission reduction effect.
SBTi typically involve setting specific emission reduction targets to ensure that a company's greenhouse gas emissions are reduced within a specific timeframe. This emission reduction effort helps mitigate the effects of climate change and reduce environmental concerns caused by global warming. By implementing SBTi, companies not only demonstrate their commitment and determination to environmental protection at the level of laws and regulations, but also contribute to the sustainable development of the global environment. The environmental factors associated with SBTs and ESG strategies are an important component of the ESG framework.
ESG strategies emphasize the close relationship between corporate social responsibility in environmental aspects and the coexistence value chain strategy between stakeholders, and require companies to consider the potential impact of their business activities on the environment, and improve their long-term competitive survival rate under global climate policies, climate finance, and carbon trading systems. By implementing SBTs, companies not only meet emission reduction goals but also demonstrate their ability to focus on long-term climate strategies and transform their application under the ESG framework, helping to enhance their sustainability capabilities.
Overall, the relationship between SBT's science-based reduction targets and ESG strategies is reflected in the company's active participation in environmental protection by formulating specific emission reduction plans, while aligning with environmental responsibilities under the ESG framework. This comprehensive approach helps businesses achieve sustainability and gain a long-term competitive edge in the business environment.
Analysis of the important correlation between the ESG Sustainability Report and the authority of the company's board of directors, high-level commitment management, and corporate governance
I .Importance of corporate governance
Corporate governance refers to the establishment of a complete set of governance systems for shareholders, directors, supervisors, and managers through effective institutional arrangements to ensure that all aspects of corporate operations can comply with the requirements of laws, articles of association, and social and public interests. Good corporate governance should be to achieve operational goals in a way that is in the best interests of the company and all shareholders, assist in corporate management and operation, and provide effective supervision mechanisms to motivate enterprises to make good use of resources, improve efficiency, thereby enhance competitiveness and promote social well-being for all.
II .ESG Sustainability Report and Board of Directors Powers
The ESG Sustainability Report is an important document provided by the company to shareholders and stakeholders, focusing on three aspects: Environmental, Social, and Governance. These reports not only provide information about the company's sustainability efforts and performance but also reflect the company's values and commitments. In this text, we will explore the important correlation between ESG sustainability reporting and corporate board authority, senior commitment management, and corporate governance.
1. ESG Sustainability Report and Board Authority:
The connection between the authority of the company's board of directors The board of directors is an important body responsible for overseeing the company's management, and its responsibilities include ensuring compliance with regulations, managing risks, and pursuing shareholder value. ESG reports usually include information about the composition of the company's board of directors, the independence of the board of directors, and the oversight functions of the board of directors. This information is crucial for investors and stakeholders as they help them assess whether a company's board of directors has sufficient authority to ensure the company's performance on ESG issues.
2. The board of directors formulates and reviews ESG policies and goals:
The authority of the company's board of directors also involves formulating and reviewing the company's ESG policies and goals. When a company's board of directors has sufficient power, they can more effectively ensure that the company incorporates ESG factors into strategic decisions. It also helps ensure that companies provide truthful and comprehensive information in their ESG reports, not just a superficial false promise. Therefore, the authority of the company's board of directors is closely related to the quality and credibility of ESG sustainability reports.
III .High-level ESG commitment management
High-level commitment manages the alignment of ESG commitments and practices. Strengthen the relationship between ESG sustainability reports, corporate board authority, senior commitment management and corporate governance:
1.Enhance the ESG expertise of the company's board of directors:
The company's board of directors should ensure that its members have sufficient ESG expertise to effectively monitor and guide the company's ESG performance. This includes understanding ESG-related regulations, trends, and best practices.
2.Incorporate ESG goals into senior management performance evaluation:
Senior management's compensation and performance evaluation should be linked to the company's ESG goals to ensure they are fully motivated and committed to achieving them.
3.Improve transparency and accuracy in ESG reporting:
Companies should ensure that their ESG sustainability reports provide true, comprehensive, and verifiable information, clearly stating the company's ESG strategy, goals, and results. This helps build trust in the report among investors and stakeholders.
4.Ensure the independence of corporate governance bodies:
Corporate governance bodies should maintain independence to ensure that they can effectively supervise the company's management and intervene in ESG issues when necessary.
IV .Promoting the Company's Sustainable Development
ESG Sustainability Report on how the relevant elements between the company's board of directors, senior commitment management, and corporate governance work together to promote the company's sustainable development.
1.Integrating ESG Goals into Company Strategy:
To achieve ESG commitments, companies should seamlessly integrate ESG goals and initiatives into their overall strategy. The company's board of directors should actively participate in determining the company's long-term strategic direction to ensure that ESG factors are properly considered. This helps ensure that ESG goals are not just superficial statements but are truly internalized into the company's mission and values.
2.Expanded Stakeholder Engagement:
In addition to shareholders, companies should actively engage with various stakeholders, including employees, customers, suppliers, communities, and NGOs. The company's board of directors should ensure that the voices of these stakeholders are heard and incorporated into ESG strategies and decisions. This helps ensure that the company's ESG performance meets the expectations of all parties and establishes long-term partnerships.
3.Monitoring and Evaluation of ESG Performance: Companies should establish effective monitoring and evaluation mechanisms to track the achievement of their ESG goals. The company's board of directors should regularly review ESG reports and ensure that the company is making tangible progress in achieving its ESG commitments. This also helps identify and address potential ESG risks early.
4.Open transparency: Companies should provide information to shareholders and stakeholders by disclosing ESG sustainability reports. These reports should be clear, easy to understand, and include specific information about the company's ESG strategy, goals, progress, and outcomes. The company's board of directors should ensure accuracy and transparency in reporting to build trust.
V .How high-level commitment management achieves sustainability goals
1. Integrate risk management:
The company's board of directors should ensure that risk management is closely related to ESG issues. This includes assessing environmental, social, and governance risks and developing strategies to address them. ESG sustainability reports should reflect the company's identification and management of these risks to maintain long-term and robust business operations.
2. Long-Term Value Creation:
The company's board of directors should emphasize long-term value creation, not just short-term profits. The commitment of senior management should be reflected in the formulation and achievement of long-term ESG goals to ensure the company's sustainability and competitiveness.
3. Objective Evaluation:
Corporate governance institutions should ensure objective evaluations of the company's ESG performance. This may include internal or external audits to ensure that the company's ESG sustainability reports are true and accurate. Objectivity assessment helps strengthen the company's credibility.
4. Investor Relations:
Companies should establish active investor relations and actively participate in ESG-related conversations. The company's board of directors should understand investors' ESG concerns to better respond to their needs and expectations.
5. Develop a clear ESG strategy:
The company's board of directors should work with senior management to develop a clear ESG strategy to ensure that the company makes meaningful progress in environmental, social, and governance areas. This requires clear goals, timelines, and resource allocation.
6. Adaptability and Innovation:
Companies should encourage adaptability and innovation to address evolving ESG challenges. Senior management should encourage employees to come up with innovative solutions and integrate ESG into the company culture.
7. Risk Management and Opportunity Identification:
The company's board of directors and senior management should work together to identify ESG-related risks and opportunities. This includes understanding how to address challenges such as climate change, societal trends, and regulatory requirements.
8. Long-Term Investment:
The company's board of directors and senior management should encourage long-term investment to support the achievement of ESG goals. This may require a change in the mindset of short-term profitability, but long-term sustainability often creates more solid value for the company.
9. Develop specific ESG indicators:
The company's board of directors and senior management should ensure that specific performance indicators and measurements are established in the ESG sustainability report. These metrics should be quantifiable so that companies can clearly track their progress in the ESG field.
10. Adapt to the supply chain:
Senior management should review and improve ESG practices in the supply chain. This includes ensuring that suppliers also adhere to high standards of ESG principles to mitigate potential ESG risks.
11. Innovative products and services:
The company's board of directors and senior management should encourage innovation to develop more environmentally friendly and socially responsible products and services. This helps meet changing market demands while also contributing to ESG goals.
12. Long-Term Investor Relations:
The company's board of directors and senior management should actively maintain relationships with long-term investors. Long-term investors are often more inclined to support companies with solid ESG performance, so this can increase the company's stability.
13. Create shared value:
Companies should pursue the goal of creating shared value not just by maximizing economic benefits. This means that companies should consider how to meet the needs of shareholders, employees, customers, suppliers, and communities at the same time to achieve sustainable business growth.
14. Promote employee engagement:
Senior management should encourage employees to actively participate in the company's ESG initiatives. Employees can become active promoters of the company's ESG field and contribute to the company's sustainability goals.
15. Risk Management and Opportunity Identification:
The company's board of directors and senior management should continuously monitor ESG risks and opportunities globally and within the industry. This helps companies better anticipate and respond to future challenges and capitalize on new business opportunities.
16. Transparency and Credibility:
Companies should ensure transparency and credibility in their ESG sustainability reports. Transparent disclosure and accurate data are essential to earn the trust of investors and stakeholders.
VI .Summary
ESG sustainability reports are reports that disclose non-financial aspects such as environmental, social, and governance aspects to the outside world. In 2020, the Financial Supervisory Commission released the "Corporate Governance 3.0 – Sustainable Development Blueprint", focusing on five main axes: "Strengthening the Functions of the Board of Directors and Enhancing Corporate Sustainability Value", "Improving Information Transparency and Promoting Sustainable Operations", "Strengthening Stakeholder Communication and Creating Good Interaction Channels", "Aligning with International Standards, Guiding Due Diligence", and "Deepening the Corporate Sustainability Governance Culture and Providing Diversified Products", hoping to help Taiwanese companies align with international sustainability trends. Among them, strengthening the functions of the board of directors is one of the important main axes. This article will explore the important relationship between ESG sustainability reports and corporate governance from the perspective of ESG sustainability reports and corporate governance.
ESG sustainability reports are closely related to corporate governance. The ESG Sustainability Report is a report that discloses non-financial aspects such as environmental, social, and governance aspects of a company to the outside world. Corporate governance refers to the internal management structure and operation of the enterprise, including the board of directors, supervisors, managers, etc. The environmental, social, governance, and other non-financial aspects disclosed in the ESG sustainability report can help the board of directors better understand the risks and opportunities of the company, thereby better formulating corporate governance strategies and plans.
High-level commitment management is also closely related to ESG sustainability reports. High-level commitment management refers to the level of importance and commitment of corporate executives to ESG issues. If corporate executives lack attention and commitment to ESG issues, it will be difficult for them to formulate effective ESG strategies and plans. ESG sustainability reports can help corporate executives better understand the importance and impact of ESG issues, thereby better formulating corresponding high-level commitment management strategies.
Finally, corporate governance is also closely related to ESG sustainability reports. Corporate governance refers to the internal management structure and operation methods of enterprises, including the board of directors, supervisors, managers, etc. The environmental, social, governance, and other non-financial aspects disclosed in the ESG sustainability report can help companies better understand their own ESG issues and shortcomings, thereby better formulating corresponding corporate governance strategies and plans.
What is an ESG Sustainability Report?
什麼是ESG永續報告書.mp4ESG Sustainability Report/Video Commentary
The ESG Corporate Sustainability Report (Environmental, Social, and Governance) is a report that provides detailed information about a company's environmental, social, and governance aspects. ESG represents three levels: Environmental, Social, and Governance. The environmental aspect focuses on the environmental impact of enterprises, such as energy use, waste management, and greenhouse gas emissions. At the social level, we pay attention to the relationship between enterprises and stakeholders such as employees, suppliers, customers, and communities, including labor rights, human rights, and consumer protection. The governance level focuses on the organizational governance structure and operation methods of enterprises, such as board structure and corporate ethics.
Why do some companies do ESG reports? Firstly, ESG reporting helps enhance a company's image and credibility. By publicly disclosing a company's ESG performance, companies can demonstrate their commitment and responsibility in sustainable development to stakeholders, enhance their credibility and integrity, and attract more investors and consumers.
Secondly, ESG reporting helps manage risk and create value. ESG-related risks, such as environmental disasters, legal risks, labor issues, etc., can cause financial and reputational losses to companies. By producing ESG reports, companies can better identify, assess, and manage these risks, reducing the likelihood of their occurrence while also identifying ESG-related business opportunities to enhance corporate value and competitiveness.
Third, ESG reporting is a transparent and open way to showcase a company's efforts and achievements in sustainable development. Through the data and indicators in the report, stakeholders can gain a more comprehensive understanding of the company's ESG performance, gain a deeper understanding of the company's operations and decisions, and make more informed investment and cooperation decisions.
What are the corresponding criteria for ESG sustainability reports? What international guidelines should be followed when writing ESG sustainability reports? Guidance? Framework? Can you refer to it?
ESG永續報告書相應準則有哪些在ESG永續報告書撰寫時應遵循那些國際準則指引框架那些可供參考 (1).mp4What are the corresponding criteria for ESG sustainability reports? What international guidelines should be followed when writing ESG sustainability reports? Guidance? Framework? Can you refer to it?
ESG (Environmental, Social, and Governance) sustainability reports, corresponding standards, etc., refer to the guidelines and guidelines that organizations should follow when writing and publishing ESG-related reports. Here are some common ESG sustainability reporting standards and frameworks, including but not limited to:
1.Global Reporting Initiative (GRI):
GRI is one of the most commonly used ESG reporting standards. It provides a framework to help organizations identify, evaluate, and report on ESG-related information. The initiative guidelines focus on the general ESG standards in various industries and fields of the company, and list common industry standards.
The purpose of GRI (Global Reporting Initiative) in ESG sustainability reports is to provide a comprehensive and prescriptive framework for companies to reveal their performance and impact in environmental, social, and governance (ESG) areas. The GRI requires companies to disclose key sustainability information, including social responsibility, environmental management, ethical management, and governance practices. By following GRI's guidelines, companies can provide more comprehensive and transparent ESG information, allowing investors, stakeholders, and society to better understand their sustainability performance and impact. GRI's goals are to promote corporate transparency and accountability, promote sustainable development practices, and provide reliable information to stakeholders to advance the sustainability agenda and create long-term value for companies.
2.SASB (Sustainability Accounting Standards Board):
SASB's goal is to develop industry-specific sustainability accounting standards to help companies report ESG information related to their business.
The purpose of the SASB (Sustainability Accounting Standards Board) in ESG sustainability reports is to provide a measurable and comparative framework for companies to disclose key data and metrics related to sustainability. SASB focuses on environmental, social, and governance (ESG) issues faced by companies in specific industries, aiming to help investors and stakeholders better understand their risk exposure, opportunities, and value creation capabilities. By uncovering key sustainability information, SASB facilitates investor assessment of corporate sustainability performance, driving transformation in investment decisions and business practices. The goal of this framework is to improve the consistency and comparability of disclosures, providing market participants with more accurate and comprehensive ESG information, thereby promoting sustainable investment and long-term value creation for businesses.
3.International Financial Reporting Standards (IFRS):
IFRS is the most widely accepted financial reporting standard globally, focusing on the accuracy and transparency of financial information. While IFRS does not explicitly require ESG disclosure, it encourages companies to provide environmental and socially relevant information in their financial reports to provide investors with a comprehensive understanding of the company's business and risks.
The purpose of International Financial Reporting Standards (IFRS) in ESG sustainability reports is to provide companies with a unified and accurate financial reporting framework to ensure that their financial information disclosures are comparable, consistent, and reliable, thereby helping investors and stakeholders better understand their financial health, operating performance, and sustainable development. IFRS requires companies to disclose environmental, social, and governance (ESG) related information in order to assess their sustainability performance and enable investors to better understand their long-term value creation capabilities and risk management practices. By adhering to IFRS, businesses can enhance transparency, comparability, and information quality, promoting investor trust and market stability.
4.International Integrated Reporting Council (IIRC):
The IIRC provides a framework and guiding principles for integrated reporting, encouraging businesses to integrate financial and non-financial information to provide more comprehensive business reporting.
The purpose of the International Joint Finance (IIF) Sustainability Disclosure Framework is to promote companies to disclose key information about their environmental, social, and governance performance in ESG sustainability reports, so as to help investors, stakeholders, and decision-makers more comprehensively evaluate their sustainability performance, promote transparency and comparability, and drive change in sustainable investment and business practices. The framework emphasizes the importance of businesses in sustainability, advocating for the establishment of quantifiable, comparable, and verifiable financial disclosure standards to drive the implementation of sustainability agendas.
5.International Joint Finance (IIF) Sustainable Financial Disclosure Framework:
IIF is an international organization of financial institutions, and its sustainable financial disclosure framework is designed to help financial institutions report information related to sustainable finance. The framework includes guidelines and reporting templates, covering aspects such as environmental risks, social opportunities, governance structures, and decision-making processes.
The purpose of the International Joint Finance (IIF) Sustainability Disclosure Framework is to promote companies to disclose key information about their environmental, social, and governance performance in ESG sustainability reports, so as to help investors, stakeholders, and decision-makers more comprehensively evaluate their sustainability performance, promote transparency and comparability, and drive change in sustainable investment and business practices. The framework emphasizes the importance of businesses in sustainability, advocating for the establishment of quantifiable, comparable, and verifiable financial disclosure standards to drive the implementation of sustainability agendas.
6.Organizational Greenhouse Gas (GHG) Guidelines:
The ISO 14064-1 guideline is used to calculate the total carbon dioxide emissions of a company or organization in the base year. It requires companies to report their direct and indirect greenhouse gas emissions data, quantify the total carbon emissions and disclose the amount of removals through the identification of carbon emission sources and the selection of emission factors.
The purpose of the greenhouse gas inventory disclosed in the ESG sustainability report is to assess the company's greenhouse gas emissions and management status. By inventorizing greenhouse gas emissions, companies can identify, identify, and quantify their total carbon emissions and understand their impact on climate change. Such disclosures help companies recognize the scale and source of their greenhouse gas emissions and take appropriate measures to reduce emissions, improve energy efficiency, and shift to a low-carbon economy. Through transparency and disclosure, companies can respond to the concerns of investors, stakeholders, and governments about climate change, demonstrating their commitment and actions towards sustainable development. The purpose of the greenhouse gas inventory is to promote the transformation of companies towards low-carbon and climate-friendly business models, reduce negative climate impacts, and contribute to building a sustainable future.
7.Product Carbon Footprint Report
A product carbon footprint report is a report that assesses the greenhouse gas emissions generated by a product throughout its life cycle. It includes the total carbon emissions from raw material collection, production, transportation, use, to final disposal or recycling. By quantifying and disclosing the carbon emissions of products, the Product Carbon Footprint Report provides a tool to assess and manage the impact of products on climate change, such as the EU Carbon Border Tax and the US Clean Act, which are based on the Carbon Footprint report for monetary quantitative calculation of the total carbon footprint emissions of products beyond the quota.
Therefore, product carbon footprint reporting plays an important role in ESG sustainability reporting. It provides tools to assess and manage the environmental impact of companies by revealing the carbon emissions of products, while also promoting the transformation of sustainable consumption and production, and promoting more sustainable production and supply chain management. The goal of this report is to increase transparency, promote improvement, manage environmental risks, and incentivize companies to take a leadership role in sustainability and meet consumer demand for sustainable products.
8.碳揭露計畫CDP.mp48.Carbon Disclosure Project (CDP):
CDP focuses on carbon emissions and climate-related risk management for companies. It provides a platform that enables organizations to report on their greenhouse gas emissions and climate-related strategies and actions.
The purpose of CDP (Carbon Disclosure Program) in ESG sustainability reports is to encourage and support companies to disclose information related to their carbon emissions and climate change to assess and manage their climate-related risks and opportunities. CDP requires companies to disclose their carbon emission data, carbon management strategies, climate goals, and action plans. By participating in CDP, companies can better understand the impact of climate change on their business and take corresponding measures to reduce carbon emissions, improve energy efficiency, and address climate risks. CDP's goal is to promote corporate transparency and accountability, providing investors and stakeholders with the information they need to drive the transition to a low-carbon economy and sustainable development practices.
9.Climate-related Financial Disclosures (TCFD) (Task Force on Climate-related Financial Disclosures, TCFD):
The TCFD Task Force on Climate-related Financial Disclosures (TCFD) is a global framework that guides companies on how to disclose climate-related risks and opportunities. It was established by the Financial Stability Board (FSB) in 2015 to guide businesses in incorporating the impact of climate change into their financial reporting and strategic decisions.
The TCFD (Climate-related Financial Disclosures) aims to promote companies to disclose climate-related information in their ESG sustainability reports. Its purpose is to allow companies to more comprehensively disclose climate-related risks and opportunities, opportunities, and risks, and to help investors, financial institutions, and stakeholders better evaluate the sustainability performance of companies. Through the requirements of the TCFD, enterprises can identify, identify, assess, and manage the impact of climate change on their businesses, improving their risk management capabilities. Additionally, the TCFD's disclosure framework provides transparency and comparability of information, facilitating investors' decision-making and enabling them to better understand the long-term sustainability and financial prospects of businesses, thereby promoting sustainable investment and sustainable development.
10.United Nations Global Compact (UNGC):
The UNGC is an initiative initiated by the United Nations to encourage businesses to adopt sustainable practices and report on their contributions to the seventeen Sustainable Development Goals (SDGs). Participants are required to submit an annual communication progress report describing their actions and outcomes in sustainability.
The purpose of the United Nations Global Compact (UNGC) in the ESG Sustainability Report is to encourage companies to adopt sustainable business practices in areas such as human rights, labor, environment, and anti-corruption. By joining the UNGC, companies commit to adhering to ten global principles to promote sustainable development, social responsibility, and ethical management. These principles cover the responsibilities of businesses in terms of human rights, labor rights, environmental protection, and anti-corruption. By participating in the UNGC, companies can collaborate with other businesses, governments, and NGOs to jointly solve global challenges and achieve sustainable development goals. The UNGC's goal is to promote the ethics and sustainability of business practices, and to promote global social, environmental, and economic development through corporate participation and leadership.
11.ISO 26000 Social Responsibility Guidelines:
ISO 26000 provides a framework to help organizations identify and manage their social responsibilities. It focuses on the impact and responsibility of an organization in terms of society, the environment, and the economy.
The purpose of the ISO 26000 Social Responsibility Guidelines in the ESG Sustainability Report is to provide a reference framework for companies to guide their social responsibility practices. The guide covers a wide range of key issues, including human rights, labor rights, environmental protection, consumer rights, and community engagement. By following ISO 26000, businesses can assess and manage their social responsibilities and engage in effective communication and collaboration with stakeholders. The guide aims to help companies achieve sustainable development, promote social justice and environmental protection, and enhance their reputation and sustainable competitiveness. The goal of ISO 26000 is to encourage businesses to consider social and environmental factors in their business operations, promote corporate sustainability, and provide a common reference standard for businesses to achieve social responsibility best practices.
12.Sustainable Development Goals (SDGs):
A global agenda adopted by the United Nations in 2015 to promote global sustainable development. The SDGs include a total of 17 goals, covering important issues in three aspects: social, economic, and environmental, aiming to achieve global sustainable development by 2030.
The purpose of the Sustainable Development Goals (SDGs) disclosed in the ESG Sustainability Report is to promote the realization of the global sustainable development agenda by guiding companies in social, environmental, and economic efforts. The SDGs include 17 specific goals and 169 related indicators, aiming to address global challenges such as poverty, hunger, educational inequality, and climate change. By supporting and contributing to the SDGs, companies can play an active role in achieving these goals, promoting social justice, environmental protection, and economic prosperity. Disclosure of SDGs information helps investors, stakeholders, and society evaluate the sustainability performance of companies and their impact on society and the environment. By focusing on and pursuing the SDGs, companies can contribute to sustainable development and create a shared prosperity and sustainable future.
These guidelines provide guidance for organizations conducting ESG-related reporting, helping them better identify, manage, and report on their environmental, social, and governance performance. Organizations can choose suitable guidelines or guidance based on their own needs and industry characteristics, and ensure that corresponding guidelines are followed in reports.
ESG永續報告書撰寫，應該如何有哪些元素.mp4What elements should I pay attention to when writing an ESG sustainability report?
A complete ESG (Environmental, Social, Governance) sustainability report is an important tool for showcasing a company's performance, goals, and plans in terms of sustainability. Here are the key elements that a complete ESG report should include to ensure its comprehensiveness and effectiveness:
1. Introduction and Company Overview: The report should begin with a compelling introduction that briefly introduces the company's background, business model, and core values. This section can also outline the company's ESG strategy and goals, as well as its commitment to sustainability.
2. ESG Strategies and Goals: The report should clearly list the ESG goals set by the company in terms of environmental, social, and corporate governance. These goals should be specific, measurable, and relevant to the business's business. The report should also explain the context, importance, and how these goals are achieved.
3. Environmental report: The report should describe in detail the company's environmental performance and commitments. This includes data and indicators on carbon emissions, energy use efficiency, water resource management, waste treatment, and ecological protection. The report should also mention the company's environmental protection measures and innovative practices for sustainable development.
4. Social Report: The report should explain the company's performance in terms of social responsibility and social impact. This includes employee welfare and development support, human rights protection, community involvement, charitable activities, and public welfare causes. The report should also focus on socially relevant issues such as supply chain management, product safety, and customer relations.
5. Corporate Governance Report: The report should reveal the company's governance structure, board structure, executive compensation, internal controls, and risk management systems. This includes the independence of board members, transparency in compensation decisions, corporate ethics and oversight mechanisms, shareholder rights protection, and shareholder participation. The report should provide a detailed description of the company's board structure, directors' backgrounds, and professional capabilities to demonstrate its independence and diversity. In addition, the report should also explain the company's executive compensation system and the role of the compensation committee to ensure the fairness, reasonableness, and connection with performance performance. The report should also elaborate on the company's internal control and risk management systems, including risk assessment and monitoring, internal audit and compliance systems, etc., to ensure that the company's operations comply with relevant regulations and ethical standards.
6. Goal Setting and Progress Reports: The report should clearly outline the specific ESG goals set by the company in terms of environmental, social, and governance aspects, and provide progress reports on achieving these goals. The report should include relevant data, metrics, and charts to showcase the company's achievements and improvements in the ESG field. Such progress reports can help investors and stakeholders assess the company's performance and commitment to sustainability.
7. Review and Verification: To increase the credibility and transparency of reports, companies can choose to audit and verify ESG reports. The report should detail the process, methodology, and results of the audit and verification to ensure the accuracy and reliability of the report. This can be done through internal or external auditors, verification bodies, or third-party bodies.
8. Continuous Improvement and Future Prospects: The report should conclude with the company's commitment to continuous improvement in the ESG field and future prospects. This can involve more specific goal setting, innovative initiatives, and stakeholder engagement initiatives to demonstrate the company's long-term plans and ambitions in sustainability.
In summary, a complete ESG (Environmental, Social, and Governance) sustainability report should include the following elements:
1. an introduction and a company overview that introduces the company's background, business model, and core values.
2. ESG strategies and goals, clearly outlining the specific goals set by the company in terms of environmental, social, and governance (ESG).
3. Environmental reports describe the company's performance and measures in carbon emissions, energy efficiency, water resource management, etc.
4.Social Report explains the company's performance and contribution in employee welfare, human rights protection, community engagement, etc.
5.The governance report reveals the company's governance structure, board structure, executive compensation, internal control and risk management system.
6. Goal setting and progress reports report on specific progress and achievements of companies in ESG goals.
7.Audit and Verification, which provides the process and results of reviewing and verifying reports.
8.Continuous improvement and future outlook, showcasing the company's continuous improvement plans and future development directions in the ESG field.
These elements can help companies comprehensively present their performance and commitment to sustainable development, and provide investors and stakeholders with a basis for evaluating and selecting companies. Additionally, reports should be accurate, credible, and transparent, continuously updated and improved to reflect the company's latest achievements and efforts in the ESG field.
Sustainability Disclosure Standards No. S1 "General Requirements for Disclosure of Sustainability-related Financial Information" and S2 "Climate-related Disclosures". What are the main differences between the two?
永續揭露準則第S1號 「永續相關財務資訊揭露之一般規定」及第S2號「氣候相關揭露」.mp4The International Financial Reporting Standards Foundation (IFRS Foundation) announced on June 26, 112 that it has issued two important sustainability disclosure standards, namely Sustainability Disclosure Standard No. S1 "General Requirements for Disclosure of Sustainability-related Financial Information" (hereinafter referred to as S1) and S2 "Climate-related Disclosures" (hereinafter referred to as S2). The following will detail the key differences between the two:
1.Scope of Disclosure:
The scope of disclosure in S1 includes the company's financial information related to environmental, social, and governance (ESG). This includes risks and opportunities related to sustainability, as well as ESG issues faced by the company.
S2 focuses on the disclosure of climate-related matters, such as greenhouse gas emissions, climate change strategies and targets, as well as risk assessment and measures to address climate change.
2.Disclosure Requirements:
S1 requires companies to provide specific and quantifiable information to reveal their ESG risks and opportunities. These disclosures can relate to aspects such as natural resource use, supply chain management, social impact, and corporate governance.
S2 emphasizes the disclosure of information related to climate change, such as greenhouse gas emissions, energy use, and greenhouse gas reduction targets, as well as the company's strategies and plans to combat climate change.
3.Target audience:
S1 is primarily aimed at investors, creditors, and other stakeholders, aiming to provide financial information about the company's ESG performance. This helps these stakeholders understand the long-term value and risks of the business.
S2 focuses more on providing investors and the market with information on climate-related matters to support climate-related investment decisions and evaluate the company's sustainability.
4.Publisher:
S1 is developed and published by the International Sustainability Standards Board (ISSB), an agency under the IFRS Foundation that focuses on developing sustainability disclosure standards.
S2 was also developed and published by the ISSB, demonstrating the ISSB's role in driving sustainability disclosure.
5.Companion Guidelines:
Both S1 and S2 may come with relevant guidelines to help businesses understand and comply with disclosure requirements. These guidelines may provide more specific explanations and examples, helping businesses ensure consistency and comparability in their disclosures.
S1 and S2 are two important disclosure standards developed by the International Sustainability Standards Board (ISSB), a subsidiary of the International Financial Reporting Standards Foundation (IFRS).
S1 focuses on the company's ESG-related financial information disclosure, while S2 focuses on climate-related disclosures. The release of these guidelines aims to improve company transparency on sustainability and climate change, providing investors and stakeholders with more comprehensive information to better assess corporate sustainability and risks.
6.Time Requirements:
The timing requirements for S1 and S2 may differ slightly. The specific time requirements may be adjusted based on different disclosure items and metrics. However, these disclosure guidelines encourage companies to provide corresponding disclosure information within a reasonable time to ensure timely and consistent disclosure.
7.Legally binding:
S1 and S2 can differ in their legal binding. This depends on the legal and regulatory frameworks of each country, as well as whether these guidelines are incorporated into local regulatory requirements. Some countries or regions may require companies to comply with these guidelines and may impose penalties for insufficient or inaccurate disclosures.
8.Regulatory Authority:
The regulatory authority for S1 and S2 may differ. The ISSB, as part of the IFRS Foundation, may be responsible for regulating and interpreting the applicability of these guidelines. In addition, regulators in various countries may also be involved in monitoring the company's compliance with S1 and S2.
9.Supporting Training and Promotion:
The release of S1 and S2 may be accompanied by corresponding training and promotional activities. These activities can help companies understand and apply these disclosure guidelines, providing necessary support and guidance. The purpose of training and promotion is to ensure that the company can comply with the guidelines and meet the consistency and quality requirements of disclosure.
Sustainability Disclosure Standards S1 and S2 are two important disclosure standards developed by the International Sustainability Standards Board (ISSB), a subsidiary of the International Financial Reporting Standards Foundation (IFRS Foundation). They differ in revealing a company's ESG-related information and climate-related matters. The release of these guidelines aims to provide more comprehensive information, allowing investors and stakeholders to better assess the sustainability and risks of businesses. Businesses should adhere to these guidelines and ensure consistency, quality, and timeliness in their disclosures. Regulators and relevant stakeholders may be involved in monitoring and promoting the application of these guidelines.
10. Disclosure Principles:
Both S1 and S2 emphasize the principles and core elements of disclosure. These principles include transparency, consistency, comparability, relevance, and reliability. Enterprises should prepare and disclose relevant sustainability information in accordance with these principles to ensure effective communication and interpretation of information.
11.Technical indicators and measurement methods:
S1 and S2 may contain some specific technical indicators and measurement methods to help companies determine and report relevant information. These metrics and methods can involve procedures and guidelines for data collection, measurement, and reporting. They help ensure consistency and comparability in disclosures.
12.Audit and Verification:
S1 and S2 may involve auditing and verification requirements for disclosed information. This helps to enhance the credibility and reliability of disclosures and ensures consistency and accuracy in disclosures. The process of auditing and verification can be conducted by independent auditors or verification bodies.
13.Compliance and Reporting Requirements:
S1 and S2 may include some compliance and reporting requirements to ensure that businesses disclose according to the guidelines. These requirements may include aspects such as frequency of disclosure, reporting format, scope and content of disclosure. Businesses should ensure that their disclosures comply with these requirements.
14.International Consistency:
S1 and S2 were developed to achieve consistency in global disclosure standards. This helps investors and stakeholders compare and evaluate the ESG performance and sustainability of multinational corporations. This also helps avoid discrepancies between disclosure requirements set by different countries or regions.
Sustainability Disclosure Standards S1 and S2 have a range of differences. These differences include scope of disclosure, requirements, target audience, issuing authority, timing requirements, legally binding, regulatory bodies, supporting guidelines, supporting training and outreach, disclosure principles, technical metrics and measurement methods, auditing and verification, compliance and reporting requirements, and international consistency. These differences aim to ensure the comprehensiveness, consistency, comparability, and reliability of disclosures, allowing investors and stakeholders to better assess the company's ESG performance and sustainability. Businesses should adhere to these disclosure guidelines and ensure consistency and accuracy in their disclosures.
15.Other Relevant Standards and Frameworks:
S1 and S2 are linked and complementary to other relevant sustainability standards and frameworks. For example, S1 can be interconnected with the Synthesis Reporting Framework published by the International Integrated Reporting Council (IIRC) to provide more comprehensive corporate reporting. S2 is linked to the recommendations and guidelines of the TCFD (Task Force on Climate-related Financial Disclosures) to promote more comprehensive climate-related disclosures.
16.Impact and Importance of the Code:
The release of S1 and S2 has significant implications for businesses, investors, and stakeholders. For businesses, adhering to these guidelines enhances their transparency, consistency and reliability in information disclosures, and provides more comprehensive information on ESG and sustainability. For investors and stakeholders, these guidelines provide a framework for evaluating and comparing a company's ESG performance and sustainability to support more informed investment and decision-making.
17. Challenges and Opportunities:
Challenges in implementing S1 and S2 include the reliability and comparability of disclosures, the complexity of data collection and reporting, compliance with disclosure requirements, and adapting to changing regulatory environments. However, these challenges also present opportunities for enterprises, such as improving data management and monitoring systems, increasing trust among investors and stakeholders, creating value and competitive advantages, etc.
18.Transparency and Collaboration: Successful implementation of S1 and S2 requires transparency and collaboration between businesses, regulators, auditors, and stakeholders. Companies should actively communicate with stakeholders to ensure the accuracy and reliability of disclosure information. Regulatory bodies should provide guidance and support to ensure the enforcement and oversight of disclosure requirements. Auditors can provide audit and verification services to ensure the credibility of disclosed information.
19.Continuous Evolution: S1 and S2 will continue to evolve and update as part of the disclosure guidelines. The ISSB and other relevant agencies will continue to monitor developments in areas such as sustainable development and climate change, and continuously revise and enhance these guidelines based on needs and trends to ensure their effectiveness and adaptability.
In conclusion, Sustainability Disclosure Standards S1 and S2 are globally important disclosure standards. They differ in terms of disclosure scope, requirements, target audience, issuing authority, time requirements, legally binding, regulatory bodies, supporting guidelines, supporting training and promotion, disclosure principles, technical indicators and measurement methods, auditing and verification, compliance and reporting requirements, and international consistency. Businesses should adhere to these guidelines and ensure consistency, comparability, and reliability in their disclosures. These guidelines are significant for enhancing corporate transparency, promoting sustainable development, supporting climate action, and facilitating decision-making by investors and stakeholders.
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