Sustainability reporting – a mix of mandatory and voluntary provisions

Sustainability and Corporate Social Responsibility (CSR) are intended to be voluntary, which goes beyond regulatory requirements. Many voluntary reporting initiatives have thus been created over time to improve the performance of organisations worldwide. Also, many national reporting provisions have been developed in recent years. 

The purpose of this article is to answer the following questions: 
- What is non-financial reporting?
- What are the benefits of sustainability reporting?
- What are the main international voluntary sustainability reporting frameworks?
- What are the sustainability reporting provisions in Singapore?

Non-financial Reporting 

Non-financial reporting can refer to sustainability reporting, corporate social responsibility (CSR) reporting, extra-financial reporting, triple bottom line (TBL) reporting, Environment, Social, Governance (ESG) information and more. In Singapore and Asia globally, we generally talk about “sustainability reporting”.

Regardless of the term used, non-financial reporting refers to measuring, analysing, and communicating to stakeholders the social, environmental, economic and governance aspects of business activity. 

Non-financial reporting still lacks regulation and harmonisation compared to financial reporting. However, after a period of increasing complexity in the sustainability disclosure landscape, there is now a trend towards greater harmonisation.

There are several international recognised reporting frameworks and more and more countries have implemented sustainability reporting provisions, including Singapore.

Benefits of Sustainability Reporting 

Sustainability reporting is a worldwide practice allowing organisations to identify and manage ESG risks and opportunities, assess and improve their ESG performance and win the trust of both internal and external stakeholders. It is a process that requires strong internal mobilisation and enhanced dialogue with external stakeholders.

Here are the main internal and external benefits for a company or organisation according to the Global Reporting Initiative (GRI):

  • Increased understanding of risks and opportunities
  • Emphasizing the link between financial and non-financial performance
  • Influencing long term management strategy and policy, and business plans
  • Streamlining processes, reducing costs and improving efficiency
  • Benchmarking and assessing sustainability performance with respect to laws, norms, codes, performance standards, and voluntary initiatives
  • Avoiding being implicated in publicized environmental, social and governance failures
  • Comparing performance internally, and between organisations and sectors
  • Mitigating – or reversing – negative environmental, social and governance impacts
  • Improving reputation and brand loyalty
  • Enabling external stakeholders to understand the organisation’s true value, and tangible and intangible assets
  • Demonstrating how the organisation influences, and is influenced by, expectations about sustainable development

Table 1 - Benefits of sustainability reporting. Source: global reporting

If you are an SME and interested in publishing your first sustainability report, please visit GRI and International Organisation of Employers’ (IOE) report from page 8 onwards Small Business Big Impact – SME Sustainability Reporting from Vision to Action.

You can search this multi-criteria database to find sustainability reports per the GRI Standards.

Sustainability reporting frameworks are standards or guiding principles that are used by companies to prepare their sustainability report. The use of the reporting frameworks is on a voluntary basis, but it is frequent that local regulations recommend or require the voluntary frameworks. As regional and national regulations tighten, more and more companies are now subject to mandatory reporting.

International Voluntary Sustainability Reporting Frameworks

The best-known and globally recognised sustainability reporting frameworks are the GRI Standards, IIRC's Integrated Reporting Framework and Sustainability Accounting Standards Board (SASB) Standards.

NB: SASB and IIRC are now under the responsibility of the International Sustainability Standards Board (ISSB).

Standards helping businesses and governments understand and communicate their impact on sustainability issues
Guidelines to state concisely how an organisation’s strategy, governance, performance and outlook result in short, medium and long term value creation given its environment
Sustainability standards tailored to industry sectors, based on the relevance, comparability and usefulness of the information to investors
Key features
• Universal and topic-specific standards

• Materiality approach

• Outward looking – the organisation’s impact on the world
• Integrated thinking – a multi-capital management approach

• Financial and non-financial value creation

• Umbrella for all reporting
• Materiality map - financially material sustainability topics per industry

• Inward looking – the world’s impact on the company and its financial performance
Global - most widely adopted standards for sustainability reporting
U.S. + recently global
General + specific for some sectors
Industry specific
Investors focused + other stakeholders
Investors focused
Type of report
Sustainability report
Integrated report
US SEC filings Sustainability report
Information to report
Universal Standards

• General disclosures
• Management approach
Topic-specific Standards
• Economic
• Environmental
• Social
Content elements

• Organisational overview
• Governance structure
• Business model
• Risks and opportunities
• Strategy
• Performance
• Outlook
• Basis of presentation
Sustainability dimensions

• Environment
• Social capital
• Human capital
• Business model and innovation
• Leadership and governance
Reporting principles
Principles for defining report content

• Stakeholder
• Inclusiveness
• Sustainability Context
• Materiality
• Completeness

Principles for defining report quality

• Accuracy • Balance
• Clarity • Comparability
• Reliability • Timeliness
Guiding principles

• Strategic focus and future orientation
• Connectivity of information
• Stakeholder relationship
• Materiality
• Conciseness
• Reliability and completeness
• Consistency and comparability
Principles for topic selection

• Potential to affect corporate value
• Of interest to investors
• Relevant across an industry
• Actionable by companies
• Reflective of stakeholder (investor and issuer) consensus
Guidance on qualitative and quantitative sustainability indicators
No guidance on indicators
Guidance on qualitative and quantitative sustainability indicators – sector specific 

Table 2 - Comparison between GRI Standards, Integrated Reporting Framework and SASB Standards
Sources: information from of GRI, IIRC and SASB websites and 

GRI Standards 

The Global Reporting Initiative (GRI) is an independent international organisation that helps businesses and governments understand and communicate their impact on sustainability issues.

Created in 1997, GRI released in 2000 the first guidelines for writing a Sustainability Report, integrating environmental, social, economic and governance issues. In the following years, these were followed by the second generation (G2) of the guidelines, third-generation (G3) and fourth generation (G4). Finally, in 2016, the GRI G4 guidelines evolved into a modular series of GRI Standards, the first global standards for sustainability reporting.

In 2021, the revised Universal Standards aimed at better positioning the use of GRI reporting to respond to emerging regulatory disclosure needs, such as the EU Corporate Sustainability Reporting Directive and the IFRS plans for enterprise value standards.

Overview of the set of GRI Standards:

Figure 3 – Overview of the GRI Standards from Global Reporting

The use of GRI Standards is communicated in sustainability reports as:

  • Following the GRI Standards: when the organisation fulfils the requirements of either Core or Comprehensive option, or
  • GRI-referenced: when the organisation reports on specific economic, environmental, and/or social impacts, without providing a full picture of the material topics.

International <IR> (Integrated reporting) Framework 

The International Integrated Reporting Council (IIRC) is a global coalition of regulators, investors, companies, standard setters, the accounting profession, academia and NGOs. The IIRC published in 2013 the International <IR> (Integrated reporting) Framework.

The <IR> Framework gives guidelines to state concisely how an organisation’s strategy, governance, performance and outlook result in short, medium and long term value creation given its environment. 

The value creation over time is shown using a combination of quantitative and qualitative information, through six capitals: financial, manufactured, intellectual, human, social and relationship and natural. These capitals are stocks of value that are affected or transformed by the activities and outputs of an organisation. The business model of an organisation is based on various capital inputs and shows how its activities transform them into outcomes (Figure below).

Figure 4 - The value creation process from

Sustainability Accounting Standards Board (SASB) 

The Sustainability Accounting Standards Board (SASB) is a non-profit organisation founded in 2011. Its first developed standards were intended for use in corporate reporting in the United States. In 2018, SASB launched a complete set of 77 industry-specific reporting standards that can be used by companies over the world. 

The SASB standards are tailored to industry sectors, based on the relevance, comparability, and usefulness of the information to investors. These standards are explained graphically through their Materiality Map, which identifies financially material sustainability issues within an industry. 

Figure 5 - Universe of sustainability issues in SASB standards

Other frameworks

We can also note the following frameworks: 

  • OECD Guidelines for Multinational Enterprises - recommendations on responsible business conduct addressed by governments to multinational, aiming to promote positive contributions by enterprises to economic, environmental and social progress worldwide.
  • ISO 26000 - is a voluntary international standard providing guidance for organisations to implement the principles and themes of social responsibility.
  • AA 1000 Accountability Principles (2018) – is an internationally accepted, principles-based framework that guides organizations through the process of identifying, prioritizing, and responding to sustainability challenges, with the goal of improving long-term performance.

There are also topic-specific frameworks, especially regarding climate change: Climate Disclosure Standards Board (CDSB), Carbon Disclosure Project (CDP), or Task-Force on Climate-related Financial Disclosures (TCFD).

For an overview of the existing reporting frameworks and their different goals, the Big eBook of sustainability Reporting Frameworks 2024 is a valuable resource.

Towards comprehensive corporate reporting

Given the multitude of guidelines and frameworks, sustainability reporting can be overwhelming for companies.

Good news: in 2020, GRI, IIRC, SASB, CDP and CDSB shared their vision of what is needed to progress towards comprehensive corporate reporting and announced their intent to work together to achieve it.

This was the first of several major advancements towards simplifying the corporate reporting landscape.

Later, IIRC and SASB announced their merger into Value Reporting Foundation.

In 2021, the International Sustainability Standards Board (ISSB) was established to meet investors’ information needs. Built on the work of SASB, TCFD, CDSB and the Integrated Reporting Framework, ISSB aims at meeting the market demand for simplification of the sustainability disclosure landscape.

For more information see this article from SASB.

In June 2023, the ISSB issued the IFRS Sustainability Disclosure Standards: IFRS S1 focuses on communication about sustainability-risks and opportunities, and IFRS S2 focuses on specific climate-related disclosures. Both standards are to be used together and are based on TCFD recommendations.

For more information about IFRS S1 and S2, please visit this page.

Sustainability reporting in Singapore

Over the last 15-20 years, sustainability reporting provisions have been rapidly increased for Singapore-based companies. These provisions refer to ESG - Environmental, Social and Governance information, and most of the reporting requirements focus on environmental topics such as water, waste, environmental protection, and pollution. 

The main actors in these reporting provisions are the Singapore Exchange, the National Environment Agency (NEA) and the PUB, Singapore National Water. More info here

Figure 6 -  Increase in number of provision between 1990 and 2017 from wbcsd.

Singapore Exchange listing rules on Sustainability Reporting

Listing Rule 711A requires every listed issuer to prepare an annual sustainability report (since financial years ending on, or after 31 December 2017). 

In Singapore, listed companies must publish a sustainability report annually

The sustainability report must describe sustainability practices concerning the primary components set out in Listing Rule 711B on a 'comply or explain' basis:

  • Material ESG factor – identify the Environmental, Social and Governance (ESG) factors that are most relevant to the company’s business model, strategy and stakeholders.
  • Climate-related reporting – align the disclosure with the recommendations of the TCFD.
  • Policies, practices and performance – implement and disclose policies, practices and performance for each material ESG factor in both qualitative and quantitative information.
  • Targets – set targets for the forthcoming year for each material ESG factor identified.
  • Sustainability reporting framework – choose an international recognized reporting framework as guidance for the sustainability report preparation (e.g.: GRI Standards, Integrated Reporting Framework, SASB Standards, CDP, TCFD, etc.)
  • Board statement – the statement of the Board should describe how they considered sustainability issues in the company’s strategy, identified and overseen the management and monitoring of the material ESG factors.

For more guidance : SGX’s Sustainability Reporting Guide.

For information regarding sustainability reporting practices among Singapore-listed companies : “Sustainability Reporting: Progress and Challenges”.

Written by
Ivona Balint-Kowalczyk
Sustainability consultant, Founder of Sustainao

Lucile Batut
Sustainable Finance Transformation