Understanding the alphabet soup of sustainability terminology
As accountants we are accustomed to the use of acronyms such as IFRS, FRS, LBTT and most of us are probably familiar with many of them.
However, the role of the accountant is changing and increasingly the topic of sustainability features in our work. This is a new topic for many of us and often reference is made to a host of acronyms that we are less familiar with.
In this article, we define and explain some of the most common acronyms referred to when the topic of sustainability is being discussed.
ESG: Environmental, Social and Governance – these represent the three pillars of sustainability and are often referred to as planet, people and prosperity.
NFI: Non-Financial information
SDGs: The 17 UN Sustainable Development Goals
TCFD: Task Force for Climate-related Financial Disclosures – established in 2015, the Task Force produces recommendations for climate change reporting. In the UK, fully aligned TCFD reporting will become mandatory for listed companies, large private companies, banks, building societies, insurance companies and some pensions schemes.
GRI: Global Reporting Initiative - produce the most commonly used sustainability reporting standards.
CDSB: Climate Disclosure Standards Board - produce a framework for reporting on environmental information.
SASB: Sustainability Accounting Standards Board - produce standards on the disclosure of financially material sustainability information. The SASB standards are targeted towards investors.
IIRC: International Integrated Reporting Council – produce the Integrated Reporting,
CDP: Carbon Disclosure Project - manage and run the global environmental disclosure system with a focus on climate change, water security and deforestation.
NFRD: Non-Financial Reporting Directive – sets out the rules on disclosure of non-financial and diversity information by large companies.
WBCSD: World Business Council on Sustainable Development – led by CEOs this global organisation encourages businesses to make the transition to a more sustainable world.
A4S: The Prince’s Accounting for Sustainability Project – established in 2004, to encourage finance professionals and business leaders to drive a fundamental shift towards resilient business models and a sustainable economy.
ABN: Accounting Bodies Network – a global network of accounting bodies established by A4S, of which ICAS is a member, to encourage the accountancy profession to drive the transition to a more sustainable economy.
SECR: Streamlined Energy and Carbon reporting – required for quoted and large UK companies for accounting periods beginning on or after 1 April 2019.