Sustainability Reporting is constantly developing: instead of merely describing the past, focus increasingly shifts towards outlooks and impact. In this interview* with Michael Winter, Managing Partner at Stakeholder Reporting, you will find some exciting information on the current status and the future prospects of Impact / SDG Reporting.
* More innovative thoughts and ideas on this topic will be presented at the DRC on September 17+18. Sign up for the event now.
What do you understand by “Impact Reporting”?
The Sustainability Reporting landscape has undergone several improvements over the last 20 years. Whereas traditional sustainability reporting was often done retrospectively and against prescriptive reporting standards, e.g., the Global Reporting Initiative; in the last decade, it has become more apparent that the mere disclosure of data is not enough to answer evolving stakeholder questions. Such questions include: What do companies stand for? What is the company purpose? How do companies meet societal needs? And apart from business value, how, and to what extent do companies create societal and systemic value? Today, more than ever, key stakeholders expect companies to demonstrate the efforts made and strides taken to contribute to societal transformation, rather than only making transparent how they aim to mitigate negative business impacts.
The Sustainable Development Goals provide a powerful aspiration for improving our world — laying out where we collectively need to go and how to get there. The SDGs also provide a universal language for corporate reporting and an authoritative framework for businesses everywhere, regardless of size, complexity or location. Through the SDGs, companies can acknowledge, internalize and report on how they specifically do their bit to achieve set global targets. In this way, the SDG language and framework enable company reporting to be more focused on the impacts of the company’s actions. It also bears great opportunities for companies to position themselves as shapers and change-makers of the future actively.
Are companies currently exploiting all of the possibilities of SDG Reporting?
Definitively not. Upon the launch of the SDGs in 2015, the SDGs became a global key topic of discussion ranging across numerous stakeholders such as nation states, the private sector, civil society as well as NGOs, all collectively contributing to the discourse outlined in the SDGs. However, in a matter of five years, the initial euphoria seems to have subsided, and business is still faced with the initial challenge of how to get on with the SDGs in business practice. This is surprising because sustainability reporting can be a suitable platform to exhibit SDG contributions. But currently, the SDGs are often only a visual add-on. So, to really show where and how contributions are made towards SDGs, it is not enough to depict the SDG icons alone. Instead, companies are expected, particularly by key stakeholder groups such as investors, employees, and customers, to broaden their communication and expand their qualitative and quantitative databases. By unveiling the causal chains of how companies can positively contribute to reaching the SDGs, companies can demonstrate their viability and sustainability to stakeholders more effectively, particularly investors.
How can companies improve reporting about their impact on specific SGDs?
As a framework, the SDGs are ideally suited to enable audiences to assess a company’s sustainability efforts, as it puts their actions into the overall societal context. However, there is no “one” way how to report on impact. We at Stakeholder Reporting think that the potential of SDGs and related information have not been leveraged to their full extent in written texts. Moreover, in order to make reports user-friendly, it is important to reduce the complexity of qualitative and quantitative data without compromising the underlying causal chains and connections. In this way, new entry and touch points for readers and users with a company’s sustainability engagement can be created. We therefore believe that by extracting information on the SDG contribution and value creation, and bundling and editing them in one place, we can facilitate the reduction of information barriers. This does not only empower stakeholders in their evaluation and decision-making process regarding a company, but can also be a conversation opener on the respective sustainability engagement.
How can companies use digital reports to communicate sustainability issues?
Digital reporting offers a vast range of opportunities to communicate and disclose sustainability information. They can be tailored to meet specific stakeholder needs. For instance, thanks to filtering and tagging system that allows users to customize the reporting content, we can create a focused, narrowed-down user experience. Another key advantage is how we can present quantitative information, that means numbers, KPIs and other data that are necessary to flank qualitative statements: interactive graphs, tables and visualization reduce complexity and engage users. Most essentially, direct links and integration of other media and communication channels, such as social media can be achieved. Information and data are linked and made accessible in just one click. In addition, stakeholders may share certain reporting pieces directly with their networks (snackable contents). In that way, corporate sustainability reports can be promoted among stakeholders faster and with greater ease, thereby accessing and attracting a broader audience.
What can the DRC participants learn in your talk for their own professional life?
Companies need to further develop their sustainability reporting. Reporting needs to evolve beyond a mere accountability exercise, towards portraying how business activity is embedded in society, and thus impacting society as a whole. Therefore, we will present ideas of how SDG Impact Reporting can increase stakeholder focus, user engagement and information value.
Join the Digital Reporting Convention and learn more about how companies use digital reports and the possibilities of SDGs to shed light on their value creation and performance in a stakeholder-oriented way: Sign up for the event