Apr 27, 2022
5 steps for impactful Sustainability Reporting
Are you in the middle of your sustainability reporting process? Feel a bit lost? Wonder where all the data you gathered last year went? Or you might not even know where to start? Don't worry; we'll guide you through the sustainability reporting journey!
So, what is sustainability reporting?
Sustainability reporting is a crucial platform for understanding an organization's sustainability impact and communicating the sustainability performance to stakeholders. It is a necessary report about an organization's environmental and social performance. Why do companies need sustainability reporting? Well, some of the significant benefits include:
Improved data quality
Improved decision making
Sustainability Reporting is not a jigsaw puzzle
If you are wondering about how to create a sustainability report, then you must follow the right reporting approach to ensure you have a smooth path on the sustainability report writing journey. There are five simple steps to follow:
Step 1: Understand why you are reporting
Before diving into doing your sustainability report, pause and think: why are you writing this report? And, who are the audiences you are trying to reach?
Companies need to address the right questions, and the information should be tailored to the company's top stakeholders to reassure that it resonates with the company's intended audience.
Audiences for a sustainability report can include:
Investors, lenders, insurers, and reinsurers
Senior leadership and Board of directors
Consumers, customers, and users
NGOs, activists, and academia
Step 2: Decide what to report on
It is essential to keep the roots healthy. Thus, companies need to decide what they need to report to build a sustainability strategy and set the vision and ambition for materiality analysis.
It is recommended to complete a materiality assessment that considers the impacts of sustainability on the business because it navigates a company to build internal alignment on sustainability priorities. Also, it helps to make rational decisions around program investments and serve as a basis for resilient sustainability strategies.
If a materiality analysis has been made in previous years, reviewing and refreshing the existing one is a good step to take.
There are multiple ways to conduct a materiality assessment. The most intuitive and robust materiality assessments incorporate diverse internal and external perspectives and blend qualitative and quantitative analysis.
Step 3: Gather qualitative and quantitative data to track your sustainability progress
To create a robust report, companies should report qualitative and quantitative data on all areas they identify as material in step 2.
Qualitative data makes the numerical data come to life. Examples of qualitative data to collect are risks and opportunities related to material areas, how these risks and opportunities are handled and the plans going forward.
It is also essential to gather relevant data. That means, e.g., not overplaying lesser material areas or putting too much emphasis on areas with a lower environmental footprint, which is considered greenwashing!
When starting to look at the data, companies should:
Gather data: Every company must collect the right data and quickly review or audit it while ensuring its accuracy. We know this is a challenge for many companies. The data tends to look differently from year to year, the sheet of emission factors used is somehow lost, and unfortunately, John, who knew all about the waste data, left the business. If this is your business, we can help you! SustainLab's sustainability platform automates the collection and processing of sustainable data, minimizes manual work, and monitors sustainable data reporting quickly and accurately.
Draft and iterate: Once the data have been collected and the report outline is prepared, you can begin to draft the report from the elements to the information on KPIs and material issues. Make sure you have plenty of time to go back to ask your stakeholders for more data and clarifications - numerous iterations are usually needed!
Step 4: Review and publish your report
Before publishing the sustainability report, it often goes through an internal approval process to ensure accuracy and control quality. The approach may differ from company to company though.
Once the report is approved, it's time to finalize and communicate the report. Reflect on the company report's original intention – why did you write this report, and who is the audience?
Collaborate with the communications and design team to produce a compelling report. Keep in mind that the report should be consistent and comparable year on year.
Publish and communicate the report internally to employees and externally to investors, potential employees, key customers, and suppliers, and publish it on the website and social media channels.
It is good to create a communication plan to use the material over the year so that the report is not forgotten on a digital shelf.
Step 5: Refine and review to improve
At this point, you likely do not ever want to look at the report again and forget all about the process. We strongly advise against that! Now is the time to review how the reporting process worked this year. Identify the unexpected bottlenecks, amplify successes for the following years, and increase transparency to enable better decision making.
Furthermore, consider tracking metrics (e.g., page views, downloads, social media impressions) and any changes in ratings and rankings after the report is launched. This helps companies utilize learnings from the reporting cycle to ensure continuous improvement. Keep track of the competitors and benchmark them year on year.
Sustainability reporting done right is a very useful tool for both understanding the impact of the company and to use for communication purposes with different stakeholders. If you need help, SustainLab's expertise and guidance can help your company gather, process, analyze and visualize all the data you need for your sustainability reporting. We’re there from the first step to the published report to help and support you throughout the process!
Get in touch to understand how SustainLab can help your company achieve data transparency and traceability for impactful reporting!
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