Businesses urged to prepare for ‘evolving sustainability requirements’
Sustainability has been a focus for organizations for some time but is now “well and truly on the leadership agenda”, says BDO.
Sustainability activities are no longer a tick a box exercise as they were previously with sustainability now actively on the agenda, according to BDO national leader, ESG and sustainability, Aletta Boshoff.
The release of the International Sustainability Standards Board's (ISSB) new standards, IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures will only see the focus in this area increase, said Ms Boshoff.
“These new standards will force more organisations to take a risk-based approach versus an 'activist' or employee-led approach,” she said.
While assurance over sustainability reports isn’t mandatory yet, organisations should start preparing as though they are, according to BDO.
“While it might not be mandatory yet, engagement in an audit process could help by illuminating the gaps or areas of opportunity for an organisation's sustainability report,” she said.
“This can be done on a step-change basis, working your way through more significant issues, or key focus areas.”
Organisations should start establishing suitable data systems now even if they decide not to engage in an audit before the requirements become mandatory.
“Ensuring you have appropriate systems to account for the sustainability data you report now ensures you can generate comparative data as you report in the future,” said Ms Boshoff.
“Engagement with the organisation's finance or data team, for example, can be beneficial to ensure the data is not only warehoused appropriately but also repeatable – either for future reports or expanded data requirements in the future.”
Sustainability “needs a home” in organisations
While there isn’t one answer for where sustainability should sit within a business, Ms Boshoff said it does need to be a person or team to drive the collaborative effort in an organization.
“That could be the audit and risk committee or the IT, human resources, facilities, or finance team,” she said.
Sustainability values and employer brand
Having a sustainability program is also becoming more important for attracting employees, particularly generation Z.
Having a clear, communicated approach to sustainability that aligns with the organisation's purpose allows your current and potential future employees to ensure their workplace supports their values and purpose.
“Naturally, there will be self-motivation from within your employee group to do things differently and make change,” said Ms Boshoff.
“Having clear communication for the level of scope and support for a grassroots or employee-led approach to sustainability initiatives within the business can help people choose the place to work that is 'right' for them and provide potential opportunities for improved sustainable impact across the organisation.”
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