Supporting ESG reporting with data standards

Posted on April 8, 2022 by Editor

The XBRL US ESG Working Group has published its final paper, on ‘Supporting ESG Data with Standards.’ It provides a discussion of the group’s findings on how the XBRL standard can be used effectively to support environmental, social and governance (ESG) disclosures, providing relevant information in a format that supports evaluation and comparability.

“Data used for investment decisions, policy-setting and risk assessment should be made available in non-proprietary machine-readable formats. Current best practices for disclosures as machine-readable data have improved quality, reduced the cost of processing, and improved timeliness and usability of reported data,” states the paper. It includes a number of detailed recommendations on how best this can be achieved, in areas such as rendering ESG data machine-readable, allowing data to be disaggregated and totalled, eliminating inconsistencies in data types and units to enhance comparability, and providing guidance and validation to confirm that a submitted report is correct.

The paper also encourages issuers and users of ESG data to stay abreast of ongoing standards-setting endeavours, and to participate in public consultations including those now being held by the SEC and ISSB.

Read more here.

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