Sustainability Accounting Standards Board (SASB)
The Sustainability Accounting Standards Board (SASB) is an independent non-profit, whose mission is to develop and disseminate sustainability accounting standards that help public corporations disclose material, decision-useful information to investors. That mission is accomplished through a rigorous process that includes evidence-based research and broad, balanced stakeholder participation.
SASB developed sector-specific Key Performance Indicators (KPIs) for sustainability, which complement the CDSB Framework’s principles on reporting environmental information in the mainstream corporate report.
SASB provides a series of standards to reporting companies from all sectors, referencing the CDSB Framework for environmental information and natural capital reporting as further guidance for certain environmental metrics
How SASB works compared to other ESG frameworks
SASB’s approach is designed to assist organisations in communicating their external ESG impacts in the language of investors, debt holders, and internal financial stakeholders.
SASB highlights financially material issues, which are things that are reasonably anticipated to significantly influence a company’s financial position or operating performance and consequently are essential to investors.
GRI is the most similar to SASB among the other ESG reporting frameworks, but it provides more material information for reporting to all stakeholders.
SASB Standards enable organizations to provide industry-based sustainability disclosures about risks and opportunities that affect enterprise value. In August 2022, the IFRS Foundation assumed responsibility for SASB Standards when it merged with the Value Reporting Foundation, which previously maintained these Standards.
SASB Standards identify the subset of environmental, social and governance issues most relevant to financial performance and enterprise value for 77 industries. The Standards were developed using a rigorous and transparent standard-setting process that included:
- evidence-based research;
- broad and balanced participation from companies, investors and subject-matter experts; and
- oversight and approval from the independent SASB Standards Board.
Why Companies Use SASB Standards
As of August 2022, the International Sustainability Standards Board (ISSB) of the IFRS Foundation assumed responsibility for the SASB Standards. The ISSB has committed to build on the industry-based SASB Standards and leverage SASB’s industry-based approach to standards development. The ISSB encourages preparers and investors to continue to provide full support for and to use the SASB Standards until IFRS Sustainability Disclosure Standards replace SASB Standards.
Businesses face challenges and opportunities affecting their long-term sustainability, from climate change and resource constraints to urbanization and technological innovation. Institutional investors need to evaluate how these issues impact companies to inform their investment decisions. SASB Standards help companies around the world identify, measure, and manage the subset of ESG topics that most directly impact long-term enterprise value creation.
SASB Standards meet investor needs.
Investors across asset classes want comparable, consistent, and reliable data on financially material sustainability factors. These same investors recognize SASB Standards as a core tool to achieve this disclosure.
SASB Standards are cost-effective.
On average, each standard has six disclosure topics and 13 accounting metrics.
SASB Standards are industry-based.
The issues that are most likely to impact financial performance vary by industry. Industry-based disclosure reduces costs and minimizes noise by surfacing the most relevant information.
SASB Standards can be used with other frameworks and standards.
SASB Standards are a practical tool for implementing principles-based frameworks, including those provided by the TCFD and IIRC. Many companies use both SASB and GRI Standards to meet the needs of various audiences. Additionally, the SASB Standards have been consolidated into the materials of the IFRS Foundation as implementation guidance. This is consistent with [draft] IFRS Sustainability Disclosure Standard S1 General Requirements for Disclosure of Sustainability-related Financial Information, which requires companies to consider SASB Standards to identify sustainability-related risks and opportunities and to develop appropriate disclosures. (Certain elements of SASB Standards have also been incorporated into the industry-based requirements of IFRS S2 Climate-related Disclosures.)
Key Considerations for Implementing the SASB Standards Establish a foundation
This chapter includes information and resources to help you with:
Setting the tone at the top
Questions for boards of directors
Questions for executive leadership team
Building capacity across functions
Worksheet: Key actions for establishing a foundation
Choose the right tools for the job
Use this chapter to assist you with:
- Understanding your options: Comparing sustainability standards and frameworks
- Developing disclosure objectives that consider audience needs and expectations
- Selecting the right frameworks: Using the SASB Standards in conjunction with GRI Standards, the Integrated Reporting Framework and/or TCFD recommendations
- Perspectives on risk: “Double materiality”
- Worksheet: Key actions for choosing the right tools
Decide where to disclose
This chapter will help you understand:
- Required disclosure
- Voluntary disclosure
- Consider your options
- Questions to consider when selecting the right reporting channel
- Worksheet: Key actions for deciding where to disclose
Understand SASB standards
Use this chapter to support your understanding of:
- SASB Standards terminology and structure of the SASB Standards
- How to determine which industry standards apply
- How to determine which disclosure topics are applicable
- What to do if multiple industries apply
- Worksheet: Key actions for understanding SASB Standards
Assess your readiness
This chapter will guide you in:
- Reviewing and understanding SASB Standards metrics
- Performing a gap analysis
- Ensuring data reliability
- Consider disclosure controls and procedures
- Consider independent, third-party assurance
- Worksheet: Key actions for assessing your readiness
Develop your disclosures
Use this chapter as a resource for:
- Considering presentation format
- Providing important context
- Disclosing modifications and exclusions
- Reviewing your overall narrative
- Worksheet: Key actions for developing your disclosures
Enable continuous improvement
This chapter is designed to help you:
- Drivers of ESG risk and opportunity
- Sustainability disclosure practices
- SASB Standards development
- Sustainability performance
- Worksheet: Key actions for enabling continuous improvement