CSR
What does CSR stand for?
Corporate Social Responsibility
What are the components of ESG?
Environment, Social, Governance
What is sustainability?
Sustainability is the balance between environment, equity, and economy.
What are material topics?
Topics that represent an organization’s most significant impacts on the economy, environment, and people.
What is the triple bottom line?
Ecological, Social, and Economic
Define CSR:
CSR is a self-regulating business model that helps a company be socially accountable to itself, its stakeholder, and the public.
Define ESG
ESG is an approach to evaluating the extent to which a corporation works on behalf of social goals that go beyond the role of a corporation to maximize profits on behalf of the corporation’s shareholders. The approach works towards achieving goals aligned with the 3 components.
What are the UN Sustainable Development Goals?
The Sustainable Development goals are the blueprint to achieve a better and more sustainable future that address many of the global challenges we face.
What is traditional materiality?
Financial information is material if it is reasonably likely to impact investor’s decision-making.
Author of “The Social Responsibility of Business Is to Increase Its Profits”
Milton Friedman
What is CSR also known as?
Corporate Citizenship
What are the criteria under the Governance component?
Executive compensation, board of directors, shareholder rights.
According to KMPG, what percentage of G250 companies report on sustainability or ESG matters?
96%
Components of Double-Materiality
Environmental and Social Materiality
Financial Materiality
What is the Legitimacy Theory?
Firms communicate information to stakeholders to conform to societal expectations.
Benefits of CSR reporting
Lower firm risk, lower cost of equity, lower cost of debt, higher credit ratings, etc.
What framework is utilized for reporting ESG disclosures to a wide variety of stakeholders?
Global Reporting Initiative (GRI)
Define Sustainability Accounting
A range of techniques, tools, and practices used in the measurement, planning, control, and accountability of organizations with regards to environment, social, and economic issues.
What is double-materiality?
Sustainability information is material if it is reasonably capable of making a difference to conclusions drawn by stakeholders concerning impacts on achieving sustainable development goals and providers of financing concerning the ability of the organization to create long-term value.
What are some examples of mandatory reporting?
Financial reporting, Tax Reporting, Internal Reporting, Regulatory Reporting
Name at least 3 Characteristics of CSR Reporting
Accuracy, Balance, Clarity, Comparability, Reliability, Stakeholder inclusiveness, Timeliness
What is the difference between CSR & ESG?
CSR focuses on the qualitative internal processes and culture - it is the ideal.
ESG relates to quantitative actions and outcomes - it is the actual.
What is the Sustainability Accounting Standards Board (SASB)?
The SASB provides industry-specific sustainability reporting guidance and is designed to focus on material risks and opportunities by industry.
Process to determine material topics
Understand the organization’s context.
Identify actual and potential impacts
Assess the significance of the impacts.
Prioritize the most significant impacts for reporting.
Benefits of reporting standards
Provide a framework
Increase credibility, consistency and compatibility of information
Allow for external assurance