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| Business Responsibility and Sustainability Reporting | |
|---|---|
| Name | Business Responsibility and Sustainability Reporting |
| Other names | BRSR |
| Discipline | Corporate reporting |
| Introduced | Late 20th century |
| Jurisdiction | Global |
Business Responsibility and Sustainability Reporting
Business Responsibility and Sustainability Reporting summarizes how corporations disclose environmental, social, and governance impacts to investors and stakeholders. It intersects with United Nations, European Union, International Monetary Fund, World Bank, and national regulators such as the Securities and Exchange Commission (United States) and Ministry of Corporate Affairs (India). Major corporations like Unilever, Apple Inc., Toyota, BP, and Siemens produce these reports alongside non-governmental organizations such as World Wide Fund for Nature, Greenpeace, Oxfam, Amnesty International, and industry groups like the International Organization for Standardization and Global Reporting Initiative.
Business Responsibility and Sustainability Reporting emerged from dialogues among actors such as United Nations Environment Programme, Organisation for Economic Co-operation and Development, International Labour Organization, World Business Council for Sustainable Development, and multilateral fora including the G20 and United Nations Global Compact. Influential corporate examples include Royal Dutch Shell, Nestlé, Ford Motor Company, General Electric, and Pharmaceutical Research and Manufacturers of America which adapted disclosures following events like the Deepwater Horizon oil spill and the BP oil spill. Academic contributors include scholars affiliated with Harvard University, London School of Economics, Stanford University, Massachusetts Institute of Technology, and INSEAD.
Regulatory frameworks derive from instruments such as the European Union Non-Financial Reporting Directive, United States Securities Exchange Act of 1934, Companies Act 2013 (India), and policy initiatives by Financial Stability Board and its Task Force on Climate-related Financial Disclosures. Standard-setting bodies include International Financial Reporting Standards Foundation, Securities and Exchange Board of India, European Financial Reporting Advisory Group, and national authorities like the Financial Conduct Authority. Enforcement and litigation often involve institutions such as International Criminal Court-adjacent tribunals in human-rights related cases and regional courts like the European Court of Human Rights.
Common frameworks include the Global Reporting Initiative, Sustainability Accounting Standards Board, Task Force on Climate-related Financial Disclosures, Carbon Disclosure Project, and standards from ISO 14001, ISO 26000, and AA1000. Methodologies draw on measurement systems from Intergovernmental Panel on Climate Change, Greenhouse Gas Protocol, Science Based Targets initiative, and databases maintained by Bloomberg, S&P Global, MSCI, Thomson Reuters, and Moody's. Sector-specific guidance exists from groups such as International Council on Mining and Metals, World Resources Institute, International Air Transport Association, and International Maritime Organization.
Typical disclosures cover themes adopted by entities like World Economic Forum, International Energy Agency, United Nations Framework Convention on Climate Change, Convention on Biological Diversity, and United Nations Declaration on the Rights of Indigenous Peoples: greenhouse gas inventories, supply-chain due diligence, labor standards, human-rights impacts, anti-corruption, and biodiversity metrics. Companies reference incidents involving ExxonMobil, Volkswagen emissions scandal, Boeing 737 MAX crises, and Tesco accounting scandal to explain governance responses. Financial-materiality assessments often cite guidance from International Integrated Reporting Council, Prince of Wales's Corporate Leaders Group, and investor coalitions such as Institutional Investors Group on Climate Change.
Assurance practices engage accounting firms like Deloitte, PwC, Ernst & Young, and KPMG as well as specialized verifiers accredited by bodies such as PCAOB and International Federation of Accountants. Scientific validation uses inputs from National Aeronautics and Space Administration, European Space Agency, research institutes including Scripps Institution of Oceanography and Max Planck Society, and certification organizations like Forest Stewardship Council and Rainforest Alliance. Litigation over misstatements has involved courts such as the United States Court of Appeals and regulators like the Competition and Markets Authority.
Boards and executives from companies such as Microsoft, Johnson & Johnson, Goldman Sachs, JPMorgan Chase, and BlackRock integrate reporting into oversight, referencing frameworks from Cadbury Report, King Report on Corporate Governance, Sarbanes–Oxley Act, and investor stewardship codes like the UK Stewardship Code. Engagement processes involve unions like International Trade Union Confederation, community groups represented by World Bank Inspection Panel, shareholders organized through ShareAction and Ceres, and philanthropic actors such as Bill & Melinda Gates Foundation and Rockefeller Foundation.
Current trends include mandatory climate disclosure rules in the European Union, consolidation under the International Sustainability Standards Board, and investor demand led by firms such as Vanguard and State Street Corporation. Challenges arise from comparability issues flagged by Organisation for Economic Co-operation and Development, data-quality concerns highlighted by National Audit Office (United Kingdom), greenwashing allegations involving brands like H&M and IKEA, and conflicts between disclosure and trade secrecy adjudicated in tribunals including the World Trade Organization. Critics cite academic studies from Columbia University, Yale University, University of Oxford, and University of Cambridge on measurement bias, while proponents point to market responses tracked by FTSE Russell, Nasdaq, and New York Stock Exchange indices.
Category:Corporate reporting