Climate and Sustainability Disclosure
An essential part of integrating sustainability considerations (such as climate change impacts) into the investment process is the ability to collect and analyze consistent and comparable information and data. Developing frameworks for more robust disclosure of environmental, social, and governance (ESG) risk information have long been central to the mission of Ceres and INCR.
In 1997, Ceres co-launched the Global Reporting Initiative (GRI), which today is the globally recognized standard for voluntary sustainability reporting, used by more than 3,000 companies in 60 countries.
In 2010, after years of petitions and advocacy from INCR members and Ceres, the Securities and Exchange Commission (SEC) issued groundbreaking interpretive guidance requiring corporate disclosure of material climate change risks and opportunities by publicly traded companies.
Today, INCR members continue to work to improve disclosure practices on climate and sustainability issues across the market. Members of the INCR SEC Working Group are working with the SEC to ensure robust implementation of the interpretive guidance on climate change and to help identify specific areas of insufficient disclosure.
INCR members also lead the develop of new and emerging disclosure frameworks to ensure investors receive the information they need. The INCR Integrated Reporting Working Group provides strategic direction and investor feedback on the development of an integrated reporting standard, working closely with the International Integrated Reporting Council (IIRC). We work on the development of key performance indications (KPIs) for reporting through the Sustainability Accounting Standards Board (SASB), and we participate in the Climate Disclosure Standards Board (CDSB), which aims to advance greater global standardization of climate-related disclosure in mainstream corporate disclosure.”
“As investors safeguarding the economic welfare of so many state citizens, we have to be informed about the risks of companies we invest in. Easy and understandable access to accurate, comparable information regarding these very real risks – and climate change is certainly one of them – is essential to protect the investments our states depend on.”
Maryland State Treasurer Nancy Kopp (INCR Member)
INCR’s Sustainable Stock Exchanges Initiative focuses on engagement with the world’s largest exchanges to press for consistent, material ESG information that is disclosed across markets.
Climate Disclosure Advocacy
In 2010, the Securities and Exchange Commission (SEC) issued interpretive guidance in the world. Over 100 INCR members and other investors worldwide supported this guidance. The guidance was a milestone in investor advocacy for more a more transparent and sustainable economy.
In 2012, INCR members from the SEC Working Group met with SEC Commissioners and Corporation Finance staffers to urge greater attention to corporate disclosure of climate change risks in opportunities in key sectors.
Developing Integrated Reporting Standards
INCR member parent company Prudential Financial is one of only seven U.S. companies involved in the Integrated Reporting Pilot Program being run by the International Integrated Reporting Council (IIRC). The pilot—set to run through October 2013—aims to test the principles, content and practical application of integrated reporting.