SAN FRANCISCO, Feb. 15, 2017 /PRNewswire/ -- The Sustainability Accounting Standards Board (SASB) today released the final SASB Rules of Procedure and the SASB Conceptual Framework, two governance documents that establish the principles and processes of SASB's approach to standards development.
The governance documents were proposed for a 90-day public comment period in early 2016. After considering feedback from the public and the SASB Board of Directors, SASB incorporated three key changes:
- Independent Governance: SASB is adopting a two-tiered governance model with separation of financial responsibilities from the standards-setting activities. In the new model, an entity called the SASB Foundation will be responsible for finances and governance. The Foundation will delegate authority for standards setting to the SASB, a newly appointed technical board, which will be accountable for the due process, outcomes, and ratification of the SASB standards, including any changes to the standards going forward. The group currently known as the SASB Board of Directors will become the SASB Foundation Trustees. The Trustees will appoint members of the SASB technical board in April 2017.
- ANSI process to expert-led process: During the development of provisional standards, SASB was accredited by the American National Standards Institute (ANSI). Going forward, SASB standards will be developed under the authority of the SASB technical board, via an expert-led development process.
- Composition of Standards-Setting Body: Under the proposed rules the standards-setting body would have had equal representation from three key stakeholder groups. In the final rules, the SASB will include experts with standards-setting, financial reporting, or sustainability domain knowledge as it relates to material risks, but there will not be designated seat types. Industry expertise will be provided by Sector Advisory Groups, to be formed by the new SASB to provide advice regarding industry and emerging issues.
"We are proud to announce SASB's transition to a two-tier governance structure commencing April 1, 2017," says Mary Schapiro, Vice Chair of the SASB Foundation Board of Directors and former Chair of the U.S. Securities and Exchange Commission. "This additional layer of governance separates fiduciary responsibility from standards setting, which will help ensure the independence and rigor of SASB's standards-setting process."
SASB is now in a period of deep consultation with issuers, investors and others on the provisional standards prior to finalization in Q4 2017. SASB invites issuers and investors to participate in the consultation process through April 1, 2017. Feedback received prior to April 1 will inform the technical agenda for the new SASB board to consider as it contemplates necessary changes to the provisional standards in order to strengthen the materiality, consistency, cost-effectiveness, and decision-usefulness of the standards. Feedback on industries and/or cross-cutting issues is welcome via consultation meetings or formal letters. SASB is also discussing with a number of companies the possibility of their using the final standards in their SEC filings for calendar year-end 2017.
The Sustainability Accounting Standards Board™ (SASB)™ is an independent 501(c)3 organization that issues industry-specific standards for use in disclosing material sustainability information in filings to the Securities and Exchange Commission. Michael R. Bloomberg, founder of Bloomberg LP, and Mary Schapiro, former SEC chairman, serve as Chair and Vice Chair of SASB's Board of Directors, and Dr. Jean Rogers serves as Founder and CEO. With significant input from corporations and investors, SASB has issued provisional sustainability accounting standards for 79 industries in 10 sectors, and is now undertaking a period of deep consultation to gather input before the standards are codified. For more information about SASB, visit www.sasb.org, or follow us on YouTube, Twitter or LinkedIn.
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SOURCE Sustainability Accounting Standards Board (SASB)