The world is shifting to a higher gear towards a more sustainable future. With this, ESG disclosures are becoming critical tools for investors and corporates alike. Shedding light on this significant issue, Nayanisha Samarakoon, Head of Policy & Advocacy at Responsible Investment Association Australasia steered the discussion with prominent leaders from the investment and sustainability arena at the recent Impact X Summit held in Melbourne. Together, they tackled the intricacies of ESG disclosure standards and the challenges and opportunities on the horizon.

The consensus among experts? ESG disclosures must evolve beyond mere compliance to truly add value. Carly Hammond, Senior Analyst for Sustainability and Impact at New Forests, stressed the importance of aligning disclosure with value creation. “For me, disclosures shouldn’t be an end in themselves — they should create value.” As investment in climate disclosure ramps up, Hammond foresees that social factors will soon become a mandatory aspect of reporting. “The question is: how can we move beyond compliance to create value?”

In ESG disclosures, what is seen as a foundational step toward comparability and consistency in reporting is standardization. Ben Stuart, Chief Commercial Officer at Xpansiv highlighted the importance of having standardized data inputs to level the playing field across industries.

“Historically, disclosures have been heavy on words; and not very heavy on data,” pointing out the industry’s shift towards data-driven, accounting-style disclosures that empower investors to make more informed decisions…

Read the full story in the November 2024 issue of Impact Leadership magazine.