Blog | Sustainability Accounting Standards Board (SASB), one more step towards sustainability.

How important is SASB to investors?

Sustainability Accounting Standards Board (SASB) is a framework used by companies from different sectors to report everything related to environmental, social, and governance (ESG) aspects to measure, identify and manage those matters that have the greatest impact within your business.

In 2018, SASB published the ranking of companies globally: eleven industries and 77 specific standards for each, meaning that companies in the same industry share the same financially relevant sustainability issues and reporting metrics.

It also has a materiality map (SASB Materiality Map), which serves as a tool for investors and other capital providers to identify the most important financial issues in each industry. The map is divided into 26 sustainability topics organized under five ESG dimensions: Environmental Capital, Social Capital, Human Capital, Business Model and Innovation, and Leadership and Governance.

Throughout the years, investors worldwide have presented problems assessing material financial issues affecting the sustainability of companies because the data presented at the time of reporting is not standardized.

The SASB classification allows them to be clearer about these issues, as it facilitates their analysis by making the data easier to compare and allows them to make better investment decisions and strategies, portfolio management, and global assets in accordance with the most relevant ESG topics, regardless of the market.

SASB is an essential tool for reporting the most important ESG issues of companies, however, it is not necessary to be limited to just reporting with this framework. A good practice that the industries are carrying out at this time is the implementation of other methodologies to complement their reporting of material issues to meet the needs of other audiences and stakeholders. For example, many industries are using the Global Reporting Initiative (GRI) and Task Force on Climate-related Financial Disclosures (TCFD) standards at the same time as reporting under SASB.

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