ACSI is considering publicly naming companies with poor sustainability reporting practices after its recent report findings show that the majority of ASX200 companies failed to provide meaningful sustainability disclosure. Companies should review their current reporting practices and consider whether more (or better) information can be provided.
On 14 June 2012, the Australian Council of Superannuation Investors (ACSI) released the fifth in its series of reports on sustainability reporting practices, The Sustainability Reporting Journey: Sustainability Reporting Practices of the S&P/ASX200 (Report). The Report found that over the 5 year research period:
- over half of ASX200 companies failed to provide meaningful sustainability disclosure;
- many companies made statements about their commitment to sustainability and sustainability strategy without disclosing their performance against their strategy;
- only 18% of ASX200 companies are considered by ACSI to be Best Practice sustainability reporters (and most of these fall into the ASX 50); and
- the number of companies structuring their sustainability reporting to the Global Reporting Initiative has stalled in the last three years.
ACSI observed that the failure by the majority of ASX200 companies to provide sufficient reporting on their performance against sustainability risks indicates that they still do not fully appreciate the materiality of these factors and the importance placed on them by institutional investors.
The Report also notes that Australian companies are increasingly falling behind other countries with respect to sustainability reporting.
In light of the Report, ACSI is now considering publicly naming companies that continually fail to provide meaningful sustainability disclosure.