Description of Characteristics:
- Investor-Focused: SASB Standards are specifically designed to identify and quantify financially material sustainability information for investors and other providers of financial capital.
- Industry-Specific: SASB Standards are tailored to 77 different industries, recognizing that material ESG issues vary across sectors.
- Evidence-Based: SASB emphasizes the importance of providing evidence to support sustainability disclosures.
- Comparable: SASB Standards promote the use of standardized metrics, enhancing comparability across companies within the same industry.
Specific Criteria:
- Conceptual Framework: Outlines the fundamental concepts and principles underlying SASB’s approach to standard setting.
- 77 Industry Standards: Each standard identifies the sustainability topics most relevant to financial performance in a specific industry.
- Metrics: Each standard includes a set of metrics designed to measure and quantify the performance of companies on those topics.
- Technical Protocols: Provide detailed guidance on how to apply the metrics and collect relevant data.
Reporting Principles:
- Financial Materiality: SASB prioritizes ESG issues that have a demonstrable impact on a company’s financial performance.
- Industry-Specific: The standards are tailored to the specific ESG factors that are most relevant to each industry.
- Evidence-Based: Companies are expected to provide evidence to support their sustainability disclosures.
- Comparability: Standardized metrics facilitate comparisons across companies within the same industry.
- Transparency: Clear and concise reporting is encouraged to ensure that information is easily understood by investors and other stakeholders.
- Conciseness: Reports should be concise and focus on the most material issues.
Reporting Process:
- Identify Industry: Determine the relevant SASB industry standard for the company.
- Conduct Materiality Assessment: Identify the sustainability topics that are most material to the company’s financial performance.
- Collect and Analyze Data: Gather and analyze data related to the identified material topics using the SASB metrics.
- Prepare Disclosure: Prepare a sustainability disclosure in accordance with the SASB Standards, providing evidence to support the reported data.
- Communicate with Stakeholders: Share the sustainability disclosure with investors and other relevant stakeholders.
Compliance Guidance:
SASB provides implementation guidance and resources to help companies comply with the Standards, including:
- Implementation Guide: Provides step-by-step guidance on using the SASB Standards.
- Materiality Map: An interactive tool to help identify material ESG issues.
- Industry Briefs: Provide insights into the sustainability context of each industry.
- Technical Bulletins: Address specific reporting challenges and questions.
Connections to Other Frameworks
- Integration with IFRS: SASB Standards have been consolidated into the International Sustainability Standards Board (ISSB) framework, which aims to develop a global baseline of sustainability-related disclosure standards.
- Complementary to GRI: While GRI focuses on a broader range of ESG issues, SASB provides a more targeted approach that is relevant to investors.
- Alignment with TCFD: SASB metrics can be used to support TCFD reporting on climate-related risks and opportunities.
Usability Evaluation:
- Level of Global Adoption: Increasingly adopted, especially in North America, but less widespread in other regions compared to GRI
- Ease of Use: Can be relatively straightforward for companies familiar with financial reporting, as it emphasizes quantitative metrics. Industry-specific nature can help focus efforts.
- Focus Areas: Primarily focuses on financially material ESG issues.
- Data Availability: Data availability can vary depending on the industry and specific metrics. Some metrics may require additional data collection efforts.
Challenges:
- Industry-Specific Focus: The industry-specific nature of SASB Standards can make it challenging to compare companies across different sectors.
- Financial Materiality Emphasis: The focus on financially material ESG issues may not fully address all sustainability concerns relevant to stakeholders.
- Data Availability: Collecting and reporting on SASB metrics can be challenging for companies that lack robust ESG data management systems.
SyncFrame Compatibility:
- Complementary Framework: SyncFrame can be used alongside SASB Standards to provide a more comprehensive assessment of ESG performance, going beyond financial materiality to consider broader impacts.
- Data Integration: SyncFrame’s data collection and reporting tools can be used to collect and analyze SASB-specific metrics.
- Impact Assessment: SyncFrame’s focus on impact measurement helps to translate SASB’s financially material information into tangible outcomes.
- Materiality Alignment: SyncFrame’s materiality matrix can be used to further refine SASB’s industry-specific materiality assessments.
Reference Links/Resources:
- Reference Links/Resources:
- SASB website: https://www.sasb.org/
- SASB Standards: https://www.sasb.org/standards/
- SASB Implementation Guide: [invalid URL removed]
- Value Reporting Foundation (VRF) (merged with IFRS Foundation): https://www.valuereportingfoundation.org/
- International Sustainability Standards Board (ISSB): https://www.ifrs.org/groups/international-sustainability-standards-board/
