Sustainability Reporting Trends to Watch

Under the current situation, businesses are inevitably facing challenges in various fronts.  It is getting more and more difficult to govern and ensure business viability and sustainability.  Even in a normal situation, businesses can no longer afford to aim only at maximizing shareholders’ return.  They also need no respond to all stakeholders affected by the company’s operations.  These stakeholders are gaining more roles and they usually expect the company to emphasize on non-financial performances, including issues on environment, social, and governance.

Sustainability has become an agenda that organizations in the business sector paid attention to in recent years.  Their sustainability goals are based on beliefs that if stakeholders benefit or the organization appropriately responds to key stakeholders’ expectations, the organization will grow more sustainably.   In order to make stakeholders aware that the company recognizes their expectations, the company prepares Sustainability Development Report to inform progresses in managing such expectations.  Sustainability Development Report of business organizations have been on an increasing trend and become one of standard practices in the business sector. 

International agencies have jointly developed Sustainability Development Report framework to ensure that the report responds to interests of stakeholders, providing the same standard with clear and concrete indicators.  At present, Global Reporting Initiative (GRI) is considered the most popular framework given its simple and clear indicators that fit well with all types and sizes of organizations in any industries.  According to a survey in 2018, global companies that produced Sustainability Development Report under GRI framework have been clearly on the rise over the past 17 years (1999-2016).

According to GRI Sustainability Disclosure Database (SDD) in 2019, compiling data from Sustainability Development Reports of companies around the world, Thailand ranked fifth in terms of sustainability data disclosures based on Sustainable Development Goals (not in accordance with GRI framework) and ranked ninth in terms of disclosures via Sustainability Development Report under GRI framework.

Information about Corporate Social Responsibility Report (CRS Report) of Thai listed companies can be considered from the Corporate Governance Report of Thai Listed Companies, conducted by the IOD.  Based on survey result over the past five years, almost 100% of listed companies in each of the surveyed year (more than 99% each) have produced CSR reports.  This reflects that Thai listed companies have emphasized on this matter for some time.

Although less than 20% of Thai listed firms’ CSR Reports over the past five years followed the GRI framework, it demonstrated persistent improvement and showed a positive trend.

The data above indicated an increasing trend of Sustainability Development Report under GRI framework both in the national and global levels.  Even though the report can be an essential tool to show how the company emphasizes on the matter, the company must recognize that the intrinsic value of the report is in the process of obtaining data not the physical form of the report.  The company should never lose sight that the true objective of Sustainability Development Report is to inform stakeholders how the company recognizes and responds to their expectations not just producing the report to meet regulatory requirements or standards.

Reference
1) Thai Institute of Directors Association (2019), Corporate Governance Report of Thai Listed Companies 2015-2019
2) GRI Sustainability Disclosure Database (SDD) 

      Waratnarn Ratchamusikpat
Senior CG Analyst– Training and Facilitators
Thai Institute of Directors Association (IOD)