SAN FRANCISCO, Dec. 6, 2017 /PRNewswire-USNewswire/ -- The Sustainability Accounting Standards Board (SASB) formally announced today it will create Sector Advisory Groups across 11 sectors to provide feedback on and further inform SASB's codified standards.
For the past several years, SASB has been soliciting and incorporating stakeholder feedback from companies and investors alike as part of the pre-implementation phase of its robust standards-setting process. Sector Advisory Groups will be focused on post-implementation review, meaning they provide ongoing feedback after SASB's codified standards are launched in the first half of next year.
"SASB has been focused on sector-specific standards since its founding, and the formation of Sector Advisory Groups is a natural next step in our stakeholder-centric process," said Jean Rogers, SASB Founder and Chair of the SASB Standards Board. "Each of these 11 groups will give issuers even more of a voice in ensuring that SASB's standards address financially-material environmental, social and governance (ESG) factors important to issuers and investors alike."
Each Sector Advisory Group will consist of 20-25 volunteer members on average, with each member serving a three-year appointment. While the majority of Sector Advisory Group members will be selected from a range of leading companies, others will come from financial institutions and/or third parties with industry expertise. They will advise SASB on matters of implementation and emerging issues that should be considered in the standards development process. Interested candidates can read more about what's involved and can submit an expression of interest form on SASB.org. Sector Advisory Group members will be selected in Q1 2018.
Improvement and opportunity for issuers in SASB's Annual State of Disclosure
The move to create Sector Advisory Groups comes as SASB released its second annual State of Disclosure Report, which highlighted both improving trends as well as opportunities for improvement. The report features SASB's analysis of the top 10 companies in each of 79 industries, by revenue, for which the independent standards-setting organization has developed standards.
One of key findings of SASB's analysis was that most companies address most SASB disclosure topics—and many address all—in annual SEC filings. In fact, 73% of companies in the analysis reported on at least three-quarters of the sustainability topics included in their industry standard, and 42% provided disclosure on every SASB topic. Both figures are slightly higher than one year ago.
The report also found that most sustainability disclosure consists of boilerplate—or highly generic—language. In FY 2016, boilerplate was used more than 50% of the time when companies addressed a SASB topic. That marked a slight improvement over prior fiscal year, when boilerplate was used in about 53% of available disclosures. Additionally, companies used sustainability performance metrics—the highest standard of disclosure under SASB—in about 29% of the cases in which a disclosure occurred in FY 2016. That marked a modest uptick from about 24% in fiscal 2015.
As SASB starts to create Sector Advisory Groups, the need for sector-specific standards focused on financially material sustainability factors remains high. Members of the Sector Advisory Groups can play a critical role for issuers. For more on the selection process, visit SASB.org.
Established in 2011, the Sustainability Accounting Standards Board (SASB) is an independent standards-setting organization dedicated to enhancing the efficiency of the capital markets by fostering high-quality disclosure of material sustainability information that meets investor needs. The SASB develops and maintains sustainability accounting standards—for 79 industries in 11 sectors—that help public corporations disclose material information to investors in annual SEC filings. The SASB's rigorous process, which includes evidence-based research and broad, balanced stakeholder participation, yields standards that are valued by investors and corporations alike because they are cost-effective and decision-useful. The SASB standards board comprises nine members with diverse backgrounds and expertise encompassing capital markets regulation and policy; investing; financial accounting; securities law; corporate finance, and sustainability. For more information, visit www.sasb.org and follow us on Twitter @SASB.
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SOURCE Sustainability Accounting Standards Board (SASB)