The Australian Council of Superannuation Investors’ recent report on disclosure of environmental, social and governance risks by ASX 200 companies reveals some mixed results. While almost 40% of companies rated in the top 2 categories of Comprehensive and Detailed, more than 40% of companies still rate in the lowest 2 categories of Basic and No reporting. Listed companies should pay particular attention to their sustainability reporting requirements during the reporting period.
The Australian Council of Superannuation Investors (ACSI) has released its seventh report, Corporate Reporting in Australia – Disclosure of sustainability risks among S&P/ASX200 companies(Report) which benchmarks the extent to which ASX200 companies report on environmental, social and governance risks as at 31 March 2014 and considers company reporting periods ended during the 2013 calendar year.
Key findings outlined in the Report include:
- 85% of ASX200 companies provide some level of reporting on sustainability factors;
- almost 40% of ASX200 companies were rated in the top 2 categories of Comprehensive andDetailed but over 40% of companies still rate in the two lowest categories of Basic and No reporting;
- larger companies continue to be more proficient sustainability reporters (with 62% of ASX50 companies reporting to a level of Comprehensive) and new entrants to the ASX tend to be disparate in their reporting practices (with reporting levels ranging from No reporting toComprehensive);
- a company's annual report continues to be the most likely place for a company to provide its sustainability reporting (153 companies), followed by the corporate website (132 companies);
- 75 companies have been reviewed in all 7 of ACSI's research projects and of these, almost 70% report to a level of Comprehensive or Detailed, and there are none rated No reporting; and
- of 8 companies disclosed by ACSI in 2013 as being rated as No reporting for 4 or more consecutive years, 5 of those companies now provide some level of sustainability reporting.
ACSI also encourages all companies to review their responsibilities in preparation for upcoming reporting periods and be aware that new reporting guidance from ASIC and the ASX Corporate Governance Council will have implications for sustainability reporting.