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Bloomberg-Backed Group to Set Sustainability Standards

The Sustainability Accounting Standards Board, a non-profit group backed by Bloomberg LP, Generation Foundation, Metanoia Fund and Rockefeller Foundation, launched this month with the goal of standardizing corporate reporting of the social and environmental performance of every publicly traded company’s operations, across 89 industries.

The non-profit aims to fill a void in corporate reporting by quantifying the value of non-financial information, through the development and distribution of a set of accounting standards for the benefit of companies, investors and the public.

The group’s goal is to become what the Financial Accounting Standards Board – the nonprofit that developed best practices in financial disclosure accounting and informs the SEC’s regulatory agenda – is to financial reporting, said SASB spokeswoman Sarah Leiseca.

SASB’s first initiative is to produce a materiality map that weights the priority of sustainability issues by industry across 10 sectors, which will help with asset allocation strategies and understanding exposure to certain kinds of environmental, social and governance risk, the group said.

SASB will eventually develop key performance indicators – for each of the 89 industries contained within the broader sectors – suitable for Form 10-K disclosure, in an effort to provide comparable corporate reporting.

SASB expects it will take between three to five years to complete a set of accepted standards and benchmarks that will allow investors to compare companies across industries, Leiseca said.

The group has support from dozens of companies and institutions and is already talking with the SEC and FASB, Leiseca said. SASB’s board of directors includes executives from BlackRock, UBS Investment Bank and Morningstar as well as representatives from the California teachers’ retirement system CalSTRS and Harvard Business School. The group also has an advisory council with executives from dozens of companies, including JP Morgan, Weyerhauser, Deloitte, Timberland, Ingersoll Rand and Johnson & Johnson.

Other groups, such as the Global Reporting Initiative and International Integrated Reporting Council, are working toward similar goals. Earlier this month, GRI announced a record 3,095 formal feedback submissions were made by sustainability experts, organizations and professionals on the next generation of of its Sustainability Reporting Guidelines, during two 90-day public comment periods.

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