GRI Argue ESG Info is Crucial for Investors
The Global Reporting Initiative (GRI) has now published an open letter arguing that Environmental, Social and Governance (ESG) information is now crucial for investors, in response to the speech (above) by IASB Board Chair. In that speech Hans Hoogervorst, pointed out that “greenwashing is rampant” in sustainability reporting.
The GRI suggest that this argument misrepresents the role of standard setters – who are responsible for establishing the best practice for disclosure and not for the reporting quality of individual companies. While the GRI shares concerns about lack of veracity in ESG reporting, financial disclosure has also suffered from ineffective reporting, harming investors and financial stability.
The GRI attempts to bring alignment and comparability to ESG disclosure, and while there are still concerns about greenwashing, ESG reporting is on the rise.
With over 90% of the world’s largest companies reporting ESG information, a recent survey of asset manager’s attitudes found that 66% believe data quality and inconsistency is the top barrier to ESG integration. The GRI argue that the onus is on companies and not standard setters to report higher quality data – and that investor demand for this data will push that improvement.
Here at XBRL International, we believe that standardisation is an important step towards effective disclosure, however, reporting also needs to be digital, accessible and comparable. And with so many competing frameworks for ESG disclosure, better alignment is key.
Read the letter here.