Sustainability Accounting Standards Board
What is SASB?
The Sustainability Accounting Standards Board is a US – based non-profit organisation set up in 2011. It is modelled on the Financial Accounting Standards Board and works within the current system of financial regulation. SASB establishes sustainability standards for the disclosure of environmental, social and governance impacts by companies trading in the US, with the mission of allowing companies and investors to make informed decisions to improve sustainability outcomes. The board’s key themes are climate change, product alignment and safety, access and affordability of services, financing and responsible lending and resource intensity and scarcity.
SASB was founded in response to a growing range of non-financial risks and opportunities affecting companies, otherwise known as sustainability issues. These issues vary by industry and so SASB works at industry level to help companies measure, manage and disclose data. Currently SASB is improving sustainability accounting standards for 80 industries in 10 sectors.
SASB’s framework sets out the basic concepts behind their standards and provides guidance to investors on the use of sustainability information. Their key characteristics of sustainability accounting are sustainability, materiality, industry focus, decision-usefulness and cost-benefit analysis.
SASB’s standards are made up of disclosure guidance and accounting standards on sustainability topics. The disclosure guidance works at industry level to identify topics which may be material to companies within that industry. SASB assess the materiality of sustainability issues for companies across a range of industries using evidence-based determination, looking at interest and economic impact. This ensures that companies are focusing on sustainability issues which are relevant to them.
SASB periodically updates its standards and invites public input on material sustainability issues and topics for its research agenda. The standards are used for guidance only as it is ultimately the individual company’s responsibility to decide which information is material, so there are no set dates on which guidelines are changed.
For more information including viewing the standards in detail, please visit the SASB website at http://www.sasb.org