Sustainability reporting

Sustainability reporting refers to the disclosure, whether voluntary, solicited, or required, of non-financial performance information to outsiders of the organization.^[1] Sustainability reporting deals with qualitative and quantitative information concerning environmental, social, economic and governance issues. These are the criteria often gathered under the acronym ESG (environmental, social and corporate governance).^[2]

The introduction of non-financial information in published reports is seen as a step forward in corporate communications and an effective way to increase corporate engagement and transparency.^[3]

Sustainability reports can help companies build consumer confidence and improve corporate reputations through transparent disclosure on social responsibility programs and risk management.^[4] Such communication aims to give stakeholders broader access to relevant information outside the financial sphere that also influences the company's performance.^[5]

In the EU, the mandatory practice of sustainability reporting for certain companies is regulated by the Non-Financial Reporting Directive (NFRD),^[6] recently revised and renamed Corporate Sustainability Reporting Directive (CSRD).^[7][8] An increasing number of organizations are providing frameworks for sustainability reporting and are issuing standards or similar initiatives to guide companies in this exercise.

There is a wide range of terminology used to qualify this same concept of sustainability reporting: ESG reporting, non-financial reporting, extra-financial reporting, social reporting, CSR reporting and socio-economic and socio-environmental reporting.