Standard Setting

SASB identifies sustainability disclosure topics that are reasonably likely to significantly impact the financial condition, operating performance, or risk profile of the typical company in each of 77 industries. Therefore, SASB Standards are a useful tool to guide company disclosure of sustainability information that a company has determined to be material to its business. Although different disclosure frameworks and standards have adopted a range of definitions of “materiality” focused on different users and objectives, SASB Standards are designed to facilitate the disclosure of the subset of sustainability information most likely to impact financial performance and long-term enterprise value. SASB Standards are designed to be used in communication to investors. See our Conceptual Framework for more information.

SASB welcomes market feedback through unsolicited input, formal consultations, comment periods for active projects, and advisory and working groups. Feedback collected through these channels may target the existing Standards or highlight emerging sustainability issues that should be considered in future updates to the Standards. For information on how to engage visit the Provide Feedback page.

Staying apprised of SASB’s standard-setting activities can provide insight into how and when to engage with SASB’s technical staff most effectively. SASB transparently provides stakeholders with a view into the Standards Board’s agenda, activities, deliberations, and decisions, the organization’s active projects, and other standards-related updates.

  • Standards Board meetings - Join Standards Board meetings to hear board discussions about research efforts and be informed about key board decisions.
  • Project-specific updates - Visit a project page and click “subscribe to project updates” to receive alerts that will inform you of the project progress, current research phase, and feedback requested.
  • Standards-related updates Complete the form and subscribe to Standards-related updates for highlights of our standard-setting activities.

The Standards are updated on an ongoing basis using a project-based model. Under this model, SASB can effectively address emerging issues with the agility to address broad themes, regulatory changes, and other trends which affect multiple sectors, while retaining its ability to execute targeted updates to individual standards. SASB applies its rigorous due process, which includes evidence-based research, broad and balanced stakeholder participation, public transparency, and independent oversight and direction from the Standards Board. Following this due process ensures that SASB appropriately balances the timeliness of updates with the need to maintain high-quality standards. 

There are currently several research and standard-setting projects underway. To see active projects and subscribe to project updates, click here. For documentation of past standard-setting activities, please visit the Standard-Setting Archive. Because market input is a vital part of SASB’s standard-setting process, including a key consideration on which projects to advance, SASB is always open to market feedback on the Standards.

SASB's approach to governance differs from a more traditional assessment of board structures, processes, and shareholder rights. Because many of these traditional governance topics are addressed by existing regulation—including stock exchange listing requirements and industry-based or jurisdictional principles and codes—SASB Standards instead include industry-specific performance metrics likely to serve as indicators of governance quality, such as fines and settlements, violations, accidents, etc. In this regard, SASB recognizes that while corporate governance drives value across every sector, each industry also has its own unique governance profile. For example, the governance issues most likely to have material financial implications might involve systemic risks (as in the Financials sector), operations in highly regulated markets (as in the Infrastructure sector), or challenges associated with less competitive markets (such as Telecommunications). SASB metrics for these and other issues are intended to complement—not replace—existing, well-established frameworks for reporting on traditional governance issues, such as those developed by the International Corporate Governance Network (ICGN), the Council of Institutional Investors (CII), and the Investor Stewardship Group.

Standards Content

SASB recognizes that there is broad support in global capital markets for all companies—regardless of their industry—to disclose their Scope 1, Scope 2, and (where feasible) Scope 3 greenhouse gas (GHG) emissions. SASB's approach to climate-related disclosure is different but not in conflict with such cross-industry reporting.

SASB’s standard-setting process is designed to elicit the metrics that are most useful to companies and investors in understanding and managing the direct risks and opportunities presented by climate change and other sustainability issues. This process has identified a GHG emissions metric (i.e., Scope 1) in the 22 industries that involve significant direct emissions—because these are the industries likely to face material financial impacts specifically related to their emissions. These impacts may manifest as regulatory risks and shifts in consumer demand, which in turn affect costs and revenues.

For indirect emissions, SASB Standards capture the operational and/or strategic factors that give rise to such emissions. For the 35 industries that indirectly contribute to greenhouse gas emissions through significant use of purchased electricity (i.e., Scope 2), SASB Standards recommend metrics related to understanding the amount, type (i.e., conventional or renewable), and source (i.e., if it is self-generated or purchased) of energy. Again, SASB’s research and consultation have demonstrated that these measures highlight the direct risk-management levers available to a company—and measure how the company is using them—and therefore provide actionable data to management and decision-useful information to investors.

For industries that indirectly contribute to greenhouse gas emissions upstream (e.g., from purchased materials processing and transportation), downstream (e.g., from distribution and use of products), or in other ways (e.g., from employee commuting and business travel)—in other words, Scope 3 emissions—SASB Standards recommend metrics directly related to performance in those areas, where they are financially material.

For more information on SASB's approach to GHG emissions and related topics, see the SASB Implementation Supplement: Greenhouse Gas Emissions and SASB Standards and the SASB Climate Risk Technical Bulletin.

Human capital issues are well-represented throughout SASB’s 77 industry standards, as detailed in the SASB Human Capital Bulletin. However, many issues are rapidly evolving and both companies and investors are increasingly attuned to their financial implications. As a result, investor expectations for human capital disclosure are rising. With this in mind, SASB is undertaking research and market engagement on the issue with the objective of evolving the content of the Standards in light of emerging trends. 

SASB’s ongoing Human Capital research project aims to assess this dynamic subject and has developed an evidence-based framework to support the identification of financially material impacts related to human capital management. This framework will enable the assessment of key themes within and across industries to form the basis of the recommendations of SASB’s technical staff to the Standards Board regarding possible modifications to industry Standards to incorporate new elements associated with human capital.  

Please visit the Human Capital project page for more information. 

Water and wastewater management is one of the more prevalent issues addressed in SASB Standards, appearing in 25 of 77 industries. However, in many cases, the issue can have diversified impacts on operating risk and financial performance from one industry to the next, and SASB considers these differences in setting standards.

Water risk impacts are physical in nature, such as those driven by limited natural water availability, competition for water resources, and watershed pollution. SASB considers two high-level categories of physical water risk: access to water and water quality. Additionally, SASB considers how the regulatory environment can affect physical water risks and a company’s ability to manage those risks. In establishing performance metrics, SASB aims to enable effective water management by improving understanding of “net water risk,” where net risk is a measure of a company’s total exposure to water risk impacts offset by the actions it takes to mitigate those risks.

SASB uses the following terms to describe performance metrics:

  • "Industry-specific" metrics are those that are tailored to a specific industry context.
  • “Industry-agnostic” metrics can be used to measure performance on a topic in a range of different industry contexts.
  • “Cross-industry” metrics are applied consistently across all industries.

SASB's bottom-up standard-setting process is designed to identify and standardize disclosure for the sustainability issues most relevant to the creation of enterprise value in each of 77 industry verticals. As a result, SASB Standards are industry-specific and primarily contain industry-specific metrics. However, our process also reveals that many risks and opportunities cut across industries and sectors and those issues in many cases can be measured consistently across different business models (i.e., using "industry-agnostic" metrics). For example, SASB disclosure topics related to energy management (35 industries), employee health and safety (26 industries), and water management (25 industries) use identical or near-identical metrics in most relevant industry contexts.

SASB standards do not currently contain "cross-industry" quantitative metrics, but we have noted increasing demand for certain metrics—such as those related to human capital management and climate change—to be more consistently applied across all industries, and these metrics are the subject of ongoing research. For qualitative disclosure, our Standards Application Guidance recommends that all companies disclose information about their governance, strategy, and risk management for all SASB disclosure topics.

No. The scope of monetary losses included in the disclosure shall include only the losses that were accrued (i.e., on the statement of profits and losses) during the reporting period, which might differ from the amount paid in that period. The entity shall report the net amount of any loss or gain, including amounts reported in a prior period that are reversed during the reporting period.

We recognize that reporting companies may face different thresholds for recognition (i.e., "probable") depending on whether they are reporting under US GAAP or IFRS standards. Nevertheless, SASB’s Standards Application Guidance recommends that, when providing disclosure in accordance with SASB Standards, companies do so in a way that is consistent with their standardized financial reporting.

All losses accrued during the reporting period shall be included in the scope of disclosure.

Using SASB Standards

A good place to start is reviewing the SASB Standard(s) for your industry (or industries), the SASB Standards Application Guidance, and the SASB Implementation Primer. Additionally, SASB has provided a number of case studies and Q&As with reporting companies that may provide useful insights on getting started. Finally, it may be valuable to review the disclosures of other SASB reporters in your industry.

For companies that straddle multiple industries, more than one industry Standard may be required to address the full array of sustainability topics reasonably likely to impact a firm’s ability to create enterprise value. One company that operates across eight SICS industries shared its approach in the SASB 201 edition of our Implementation Webinar Series. Please consult the SASB Standards Application Guidance and the SASB Implementation Primer for further information.

Not necessarily. Companies may opt to disclose SASB data through a variety of channels used to communicate with investors, including annual reports to shareholders, integrated reports, sustainability reports, stand-alone SASB reports, investor relations websites, and regulatory filings. The best choice will depend on the company’s circumstances and the laws and regulations that govern the company’s disclosures. For more information, see “Deciding Where to Disclose” within the SASB Implementation Primer. For examples of how companies use SASB Standards in a variety of reporting channels, see Companies Reporting with SASB Standards.

SASB does not prescribe disclosure requirements. A company determines for itself which SASB Standards are relevant to it, which disclosure topics are financially material to its business, and which associated metrics to report. When a company determines that a sustainability topic is financially material to its business, SASB’s voluntary standards offer a way to standardize disclosure on that topic, for the benefit of both companies and investors. 

For more information on determining which disclosure topics and associated metrics to disclose, see the “Determine Which Disclosure Topics are Applicable” section of the SASB Implementation Primer. Informed by extensive investor feedback, SASB’s Standards Application Guidance recommends that when a company omits or modifies a SASB metric, it should disclose its rationale for doing so. 

SASB Standards are designed to address sustainability factors that are applicable to the typical company within an industry. In some cases they may:

  • Include topics that, for certain companies, may not be financially material; and/or
  • Not necessarily include every sustainability factor that is financially material to a reporting company.

SASB’s Standards Application Guidance recommends that when a company omits or modifies a SASB metric, it should disclose its rationale for doing so. 

When choosing to include additional topics in its disclosure, a company should consider providing a narrative describing why the topic is important; reviewing other SASB industry standards in which the topic is covered to ensure performance metrics are well-aligned with those commonly in use; and contacting the relevant SASB sector analyst to provide feedback on whether the topic should be included in the SASB Standard and why.

For more information, see the “Understanding SASB Standards” section of our Implementation Primer.

No. Companies are responsible for determining which SASB disclosure topics represent material risks or opportunities for their business and which associated metrics warrant disclosure, taking the company’s business model, business strategy, and relevant legal requirements into account. A company can make a disclosure using the SASB Standards and, in doing so, state that it has not concluded that the information is financially material.

Licensing SASB Standards

SASB's IP available for licensing includes:

  • The Standards (and Materiality Map) at different levels of granularity to best suit your organization's needs
  • A database of 89,000+ public entity ISINs mapped to their respective industry within SASB's Sustainable Industry Classification System® (SICS®)
  • SASB disclosure topics and the corresponding channels of financial impact
  • SASB disclosure topics and the corresponding climate risks from the TCFD and the SASB Climate Risk Technical Bulletin

To learn more, please see the Licensing Use section of our website. For answers to additional licensing questions, see How to License SASB Standards.

Yes, SASB's Materiality Map™, which is a high-level visualization of the more detailed Standards, can be accessed through a formal licensing agreement. If you would like access to this file and the rights to use the contents of the Map in your commercial activities, please email licensing@sasb.org to get started.

For answers to additional licensing questions, see How to License SASB Standards.

Commercial use of SASB Standards and/or related IP is permissible when a licensing agreement is in place with the SASB Foundation. Commercial use of SASP IP in the absence of such an agreement violates the copyright protections of SASB IP.

Examples of non-commercial and commercial use are included below:

Non-Commercial Use:

  • Using the Standards for your industry (or industries) to collect data and report your organization’s performance internally or externally
  • Consulting the Materiality Map™ to learn about SASB
  • Using the Standards for engagement with portfolio companies
  • Using the Standards for manager selection and/or evaluation (limited to asset owners)
  • Referencing SASB in proxy voting guidelines or investment policies
  • Publishing an article or non-commercial content that includes limited content from the Standards or other SASB resources

Commercial Use:

  • Incorporating the Materiality Map™ (or a substantial reproduction of the Materiality Map™) into an internal research database
  • Using the Standards (or a substantial reproduction of the Standards) to rate or evaluate companies
  • Mapping SASB Standards or the Materiality Map™ to a third-party data vendor and/or ESG ratings vendor
  • Incorporating the Standards into investible products, ratings products, or products offering ESG data
  • Incorporating the Standards into research reports or analytics platforms
  • Using the Standards for manager selection and/or evaluation in an investment process on behalf of fee-paying clients
  • Using the Standards in a consultative or advisory basis

For answers to additional licensing questions, see How to License SASB Standards.

SASB is a standard-setting organization. SASB is not a data provider. There is no obligation for companies to report their SASB-aligned disclosures directly to SASB, as this information is designed to be in the public domain. For licensees interested in a list of companies making disclosures consistent with SASB Standards, please see our list of reporting companies.

For answers to additional licensing questions, see How to License SASB Standards.

SASB Standards, the evidence behind the Standards, and links to third-party data sets and schema are updated periodically as standard-setting projects conclude or as third parties evolve their methodologies. All licensees will be provided resources to account for any changes to ensure seamless updates and integration. SASB updates its database of 89,000+ public entity ISINs mapped to their respective SICS® industry on a quarterly basis. These updates will be delivered by the 15th day of each new quarter.

For answers to additional licensing questions, see How to License SASB Standards.

Value Reporting Foundation

An integrated report is a concise communication about how an organization’s strategy, governance, performance, and prospects, in the context of its external environment, lead to the creation, preservation, or erosion of value in the short, medium, and long term.

SASB Standards provide the disclosure topics and accounting metrics needed to accurately assess the effectiveness of a business’s governance, strategic planning, and risk management, enabling better comparability and accountability. It enables the communication of performance on sustainability risks and opportunities in greater detail and with greater comparability.

For more information, read "Strengthening an Integrated Report Using SASB Standards" and check our Knowledge Hub for additional implementation resources.

The Value Reporting Foundation will publish ongoing guidance, case studies and resources related to how to use the integrated thinking principles, the <IR> Framework, and SASB Standards together. Please visit the Knowledge Hub to review our latest resources.

The International <IR> Framework and SASB Standards will remain complementary tools. While the Value Reporting Foundation will provide guidance on how to use both together, we expect organizations to use the standards and/or frameworks best suited to their needs to fulfill expectations for transparent, robust reporting to the range of stakeholders they deem most appropriate.

No. SASB Standards will continue to be set according to the principles, processes, and practices outlined in the SASB Conceptual Framework and Rules of Procedure. The SASB Standards Board—an independent board that is accountable for the due process, outcomes, and ratification of the SASB Standards—will continue to play the same role.

No. We will continue using a project-based model to consider revisions to the Standards. SASB Standards will continue to be set according to the principles, processes, and practices outlined in the SASB Conceptual Framework and Rules of Procedure.

The merger of SASB and the IIRC to create the Value Reporting Foundation does not affect the FSA Credential, as its curriculum already includes integrated reporting and the <IR> Framework.

For addition questions about the Fundamentals of Sustainability Accounting Credential, see our FAQ.

Sustainability Disclosure Landscape

SASB Standards can provide an industry-specific set of climate-related disclosure topics and associated metrics to help a company more effectively implement TCFD disclosure. Investors have increasingly coalesced around a combination of the TCFD recommendations and SASB Standards as foundational tools to provide capital markets with effective climate- and sustainability-related financial disclosure. This pairing recognizes that such disclosure should contain both qualitative disclosures and quantitative metrics.

  • Qualitative information, like that recommended by the TCFD regarding a company's approach to governance, strategy, and risk management, provides essential context to investors, helping them more fully understand the company’s current position, future prospects, and the relevant circumstances under which performance has been achieved.
  • Quantitative metrics, like those included in SASB Standards, introduce essential elements of accountability and comparability to climate-related financial disclosure. They shed important light on the effectiveness of a company’s governance practices, its strategy, its approach to risk management, and its progress toward key performance targets. Quantitative metrics also facilitate comparison to peers or industry benchmarks.

For more information about how the TCFD framework and SASB Standards fit together, see the TCFD Implementation Guide, TCFD Good Practice Handbook, and SASB Climate Risk Technical Bulletin.

Five framework and standard-setting organizations—CDP, CDSB, GRI, IIRC and SASB—have put forth a shared vision for a comprehensive corporate reporting system and a commitment to collaborate to achieve it. The joint statement presents common language and visuals to describe how existing sustainability standards and frameworks can complement generally accepted financial accounting principles (Financial GAAP) and can fit together to form the basis for a coherent and comprehensive corporate reporting system. Read more about the joint statement and its significance. 

As outlined in the joint statement, these five frameworks and standards offer complementary approaches. However, each framework and standard is designed for a unique set of stakeholders and objectives. In SASB’s view, companies can use different frameworks and standards to develop a system of disclosure tailored to the unique needs of their stakeholders.

Companies can use SASB Standards to provide a baseline of investor-focused sustainability disclosure. For example, SASB Standards can be used by companies as a practical tool for implementing the principles-based framework recommended by the Task Force for Climate-related Financial Disclosures (TCFD). Similarly, SASB Standards enable robust implementation of the Integrated Reporting (<IR>) framework, providing the comparability sought by investors. Other sustainability-related disclosure frameworks serve their own unique purposes, and ultimately, companies must evaluate and decide which meet the needs of their key stakeholders.

 

Within the growing field of sustainability-related disclosure, a variety of frameworks and standards have been developed to help establish a foundational layer of relevant, comparable, and reliable data from companies.

  • Disclosure frameworks provide a set of principles-based guidance for how information is structured and prepared, and which broad topics are covered.
  • Disclosure standards, like SASB Standards, provide specific, replicable, and detailed requirements for what should be reported for each topic. In other words, standards make frameworks actionable by providing comparable, consistent, reliable information.

Disclosure frameworks and standards are complementary and designed to be used together. Standards make frameworks actionable, ensuring comparable, consistent, and reliable disclosure.

SASB and the Global Reporting Initiative (GRI) provide compatible standards for sustainability reporting, which are designed to fulfill different purposes and are based on different approaches to materiality. SASB Standards focus on ESG issues expected to have a financially material impact on the company, aimed at serving the needs of most investors. GRI Standards focus on the economic, environmental, and social impacts of a company in relation to sustainable development, which is of interest to a broad range of stakeholders, including investors. Many companies—including ArcelorMittal, PSA Group, Diageo, and Nike—use both SASB and GRI standards to meet the needs of their audiences.

Still, SASB and GRI understand that the sustainability disclosure landscape can appear complicated, and for companies that use both sets of standards, the reporting effort can be high. To help address this, the two organizations have published a joint paper to demonstrate how some companies—including General Motors and Suncor Energy—have used both sets of standards together and the lessons that can be shared. SASB and GRI also aim to help the consumers of sustainability data understand the similarities and differences in the information created from these standards.

Yes. In fact, SASB mapped its Standards to the SDGs and found that 98 percent of the industry-specific topics included in SASB Standards are related to one or more SDG targets. Thus, SASB Standards can provide a useful tool for companies and investors to identify the SDG targets most relevant to financial performance in a given industry. This can help both companies and investors allocate financial capital and other resources to areas where the potential to influence specific SDG targets aligns with the potential to impact financial returns. When companies and investors can simultaneously achieve positive impact, reduce negative impact, and meet their financial risk-and-return targets, we call this intersection the “sweet spot.”

Although SASB is not a tool to measure progress toward achievement of the SDGs, nor to communicate a company’s contribution toward achievement of the Goals, helping companies and investors identify the “sweet spot” has the potential to unlock significant capital toward the achievement of the SDGs. Read more about the SASB-SDG mapping and SASB’s views on its capabilities in SASB’s Industry Guide to the SDGs.

SASB is not affiliated with the Financial Accounting Standards Board (FASB) or the International Accounting Standards Board (IASB). For more information on SASB’s governance structure and sources of income, see Governance.

Have more questions?