International Standards for Sustainability Reporting

What are the GRI Standards?

The GRI Standards are one of the most widely used non-financial reporting standards globally, developed by the Global Reporting Initiative (GRI). They provide a systematic framework for businesses and organizations to disclose their performance in three key areas: Environmental (E), Social (S), and Governance (G). The core objective of these standards is to promote corporate transparency and help stakeholders—including investors, employees, customers, and the public—better understand a company's sustainability efforts and achievements.

As a non-financial reporting standard, the GRI Standards emphasize that companies should go beyond traditional financial reporting to further disclose the environmental and social impacts related to their business activities. With the growing global focus on corporate social responsibility and sustainable development, the GRI Standards have become a crucial tool for companies to systematically collect, analyze, and disclose these important non-financial information. These standards not only support compliance in the global market but also enhance attractiveness to investors.

Additionally, it is important to note that the GRI Standards are a dynamic framework that is regularly updated to adapt to the evolving challenges and expectations of global sustainability. This ensures that companies can maintain the forward-looking and relevant nature of their non-financial reports and reflect the most important sustainability issues. By adhering to the GRI Standards, companies can effectively demonstrate their commitment to long-term sustainable operations and ensure that their reports are comparable and consistent on a global scale.

Other International Sustainability Reporting Standards

In addition to the GRI Standards mandated by Taiwan’s Financial Supervisory Commission (FSC), there are other international standards such as SASB and TCFD. Below is a summary table of GRI, SASB, and TCFD:

Why Write a Corporate Sustainability Report?

Recently, the FSC has mandated that from 2025 onwards, all publicly listed companies in Taiwan must prepare a sustainability report. These reports should detail the company's actions and achievements in environmental protection, social responsibility, and corporate governance, and should be prepared according to GRI Standards. This regulation not only requires companies to comply with laws but also aims for them to systematically disclose how they address ESG challenges and their achievements in these areas.

This requirement helps enhance the international competitiveness of Taiwanese companies, as more and more international investors view ESG performance as a crucial factor in investment decisions. By preparing sustainability reports, companies can better showcase their commitment to sustainable development, attracting more responsible investment (RI) and impact investing capital. Additionally, it helps companies proactively identify and manage potential risks, achieving long-term stable development.

Benefits of Writing a Sustainability Report:

Enhancing Corporate Transparency

1. Information Disclosure: Sustainability reports require companies to detail their activities related to environmental, social, and governance (ESG) aspects, increasing information transparency. This transparency allows stakeholders to better understand the company's operations and social impact.

2. Building Trust: When companies publicly disclose their ESG activities and performance, it helps build and maintain trust with investors, customers, and the public, which can translate into higher brand loyalty and customer confidence.

Strengthening Corporate Brand Image

1. Showcasing Social Responsibility: Sustainability reports demonstrate a company’s commitment to environmental protection, social responsibility, and corporate governance, helping establish the company as a responsible and sustainable entity. As consumers increasingly focus on corporate social impact, this image becomes particularly important.

2. Attracting Social Attention: A company’s sustainability efforts and achievements can be communicated to a wide audience through the report, including media, NGOs, and the public, thereby enhancing the company's social visibility and brand influence.

Attracting Investors

1. Increasing Investment Appeal: Investors are increasingly valuing ESG factors for their long-term impact on corporate value. By preparing sustainability reports, companies can showcase their achievements in these areas, attracting more responsible investment (RI) and impact investing capital.

2. Reducing Investment Risks: Sustainability reports allow investors to understand a company's risk management measures, especially those related to environmental and social risks, helping them make more informed investment decisions and reduce investment risks.

Promoting Internal Management Improvement

1. Performance Evaluation Tool: The process of preparing a sustainability report encourages companies to systematically collect and analyze ESG data, helping them better understand their performance and identify areas for improvement.

2. Enhancing Internal Collaboration: The process of report preparation involves collaboration between different departments, which strengthens internal communication and cooperation, improving overall operational efficiency.

Ensuring Regulatory Compliance

1. Meeting Regulatory Requirements: In some regions or industries, preparing sustainability reports is part of regulatory requirements. By preparing these reports, companies can ensure compliance with relevant laws and regulations, avoiding legal risks from non-compliance.

2. Obtaining Certifications and Standards: Some companies can also use the report to obtain relevant certifications, such as ISO 26000 or other international standards, further enhancing their market competitiveness.

Enhancing Market Competitiveness

1. Differentiated Competition: In a competitive market, having strong ESG performance and publicly reporting it can become a key differentiator for companies, helping them stand out in the market.

2. Creating Business Opportunities: Companies with good ESG performance can attract more partners and customers, particularly those that also value sustainable development, thereby creating more business opportunities.

Fostering Innovation and Continuous Improvement

1. Identifying New Opportunities: Focusing on sustainability issues can stimulate a company’s innovation potential, such as developing environmentally friendly technologies or sustainable products, which not only helps protect the environment but also opens new markets and revenue sources.

2. Driving Long-Term Development: By continuously improving ESG performance, companies can enhance their ability to achieve long-term sustainable development and maintain a competitive advantage in a rapidly changing market environment.
    

How to Align with GRI Standards When Writing a Sustainability

Report To align with GRI Standards when writing a sustainability report, companies need to follow a systematic and comprehensive process. This process ensures the completeness and transparency of the report content and accurately reflects the company's performance in Environmental (E), Social (S), and Governance (G) areas. Here are the main steps to prepare a sustainability report in compliance with GRI Standards:

1. Understand the GRI Standards Framework：Companies should deeply understand the core framework of GRI Standards, which includes three main parts: Universal Standards, Topic-specific Standards, and Sector Standards. Universal Standards apply to all organizations and cover basic reporting requirements; Sector Standards provide industry-specific indicators; Topic-specific Standards address specific issues related to environmental, social, and governance aspects. Companies should select and apply relevant standards based on their industry and operations to ensure the report meets GRI standards.

2. Determine Report Scope and Material Topics：Before writing the sustainability report, companies need to define the scope and material topics of the report. This step involves identifying which ESG issues are most significant for the company's operations and have substantial impacts on stakeholders (e.g., investors, employees, suppliers, customers). Companies can determine these material topics through internal discussions, stakeholder interviews, and market research to ensure the report focuses on the most impactful issues.

3. Collect Data and Information：Once the report scope and material topics are determined, companies need to systematically collect relevant data and information. This data should cover all areas required by GRI Standards, including Environmental indicators (e.g., carbon emissions, energy use, waste management), Social indicators (e.g., labor rights, community engagement, diversity and inclusion), and Governance indicators (e.g., board structure, executive compensation policies, compliance). During data collection, companies should ensure the accuracy and comparability of the data to facilitate stakeholders' understanding and use.

4. Write and Structure the Report：After data collection, companies should write and structure the report according to GRI Standards. The report should include a clear introduction that presents the company’s background, mission, and values, and outlines the purpose and scope of the report. It should cover the company's performance in environmental, social, and governance aspects, with specific data and case studies to support these descriptions. Additionally, the report should include the company’s future goals and commitments, showcasing its plans for continuous improvement in ESG areas.

5. Internal Review and External Verification：After completing the report, companies should conduct an internal review to ensure the accuracy and consistency of the content. They may also consider submitting the report to a third-party verification agency for external verification to enhance the report's credibility and authority. This not only improves the quality of the report but also increases trust among investors and other stakeholders.

6. Public Release and Continuous Improvement：Finally, companies should publicly release the audited and verified sustainability report, ensuring that all stakeholders can easily access this information. After publication, companies should collect feedback and make continuous improvements based on this feedback. This approach helps companies not only meet current reporting requirements but also more accurately and comprehensively reflect their ESG performance in future sustainability reports.

In conclusion, for companies obligated to prepare sustainability reports, it is essential to fully understand the reporting standards and regulatory requirements. This is not only a compliance necessity but also an important way to enhance corporate image and brand value. Writing a high-quality sustainability report involves adherence to GRI Standards and relevant regulations, systematically collecting data, analyzing performance, and conducting internal and external reviews. To ensure that the report content meets the standards and accurately reflects the company's efforts in Environmental (E), Social (S), and Governance (G) areas, it is advisable for companies to seek professional assistance. Professionals can provide expert guidance to ensure that the report not only meets regulatory requirements but also effectively communicates the company's sustainability commitments, thereby enhancing market competitiveness and investor confidence.
 

Relevant Links:

National Bar Association - ESG (Sustainability) Committee

ESG Introduction Video - Deputy Chairman Huang Yuwei of the National Bar Association ESG Committee

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