What is SASB?
Kylie Ford, a senior consultant at Goby, takes a few minutes to explain the SASB standard, how it's designed to benefit your organization, and how it fits into your ESG strategy.
Hi, I'm Kylie Ford. I'm a Senior ESG Consultant at Goby.
One thing my clients have asked me about a lot this year has been SASB. What is SASB? Well, I could tell you that it stands for the Sustainability Accounting Standards Board.
And to be honest, what it does is largely on the tin there; it's a set of standards for recommended financial disclosures based on ESG topics that are likely to impact a company's financial performance.
But the most important thing to understand about SASB is that there is one audience in mind for these standards, and that is: investors. The idea is that if you utilize the SASB standards, these disclosures will arm investors or potential investors with the information they need to be able to make the most informed investment decisions possible.
The way that it's able to do this is by being industry-specific, and this makes sense, right?
What is going to materially financially impact one company is going to be different than another. Let's say we're looking at a telecom company versus a nonalcoholic beverage company.
Well, a nonalcoholic beverage company is going to be chiefly concerned with water use. So one of the recommended disclosures from the SASB standards for them is going to be actual gallons of water use, water reclaimed, things of that nature.
Whereas over on the telecom side, a similar recommended environmental disclosure would be probably energy performance or kilowatt hours used in operations, things like that.
Finally SASB is less daunting, I think, than people give it credit for. It's not just for public companies and it does not only need to be disclosed within regulatory documents; that's an early perception about SASB that's no longer the case. It's honestly quite a flexible standard.
And you can think of them more as guidelines. If there's a disclosure that you don't think is relevant to your operations, or maybe you don't feel right disclosing on because of the data that you have available, you can skip it; just provide your rationale. Investors would rather have anything than nothing. Likewise, if there's a disclosure that you think really does help tell your story well, but it's not recommended for your industry, you can still disclose on it. You can also utilize SASB disclosures within any kind of document you want, whether it's an integrated report or even a standalone document that you put together and just give to investors.
So give SASB another look; I think you're gonna find it's a lot more malleable and a lot less daunting than you might have otherwise seen. And truly it helps you tell your best story to investors.