The consistency project

The Consistency Project is a collaborative project between the Climate Disclosure Standards Board (CDSB), the Global Reporting Initiative (GRI), the Organization for Economic Co-operation and Development (OECD) and the United Nations Conference on Trade and Development (UNCTAD). These project partners are supported by, and contribute to the work of organizations undertaking complementary work including the CDP, International Integrated Reporting Committee and the World Business Council on Sustainable Development.

The timing for ensuring greater consistency is right as climate change-related disclosure is still developing and countries are not yet completely locked into a specific regulatory path.Burgeoning disclosure activity around the world reflects the increasing realization that an organization’s condition, performance and long-term resilience depend on complex interactions between its strategy, governance and business model and its management of economic, social and environmental value. To varying degrees, governments have introduced or adopted provisions that require organizations to report on governance, environmental, social and other matters in addition to their financial results.

The objectives of the Consistency Project are to:

• provide information, evidence and resources to support greater understanding of the policies, initiatives and practices that currently lead to the demand for and supply of climate change related information;
• identify the main problems linked to lack of consistency of climate change disclosure systems;
• assess the benefits of greater consistency;
• and pave the way for further discussions and action to support consistency in the demand for and supply of climate change-related information.

The asessment of the benefits of greater consistency depends in part on an understanding of existing provisions and how the individual data sets that support the analysis and modelling activity needed for more effectie reporting are already being disclosed. A clear understanding of the current position is also designed to ensure that existing provisions are taken into account in the development of future provisions so that they supplement and complement reporting practices that are already meeting stakeholder needs to some extent.

The information compiled through the Consistency Project pages on Collaborase will be used for research and analysis into synergies and gaps in reporting practices around the world, opportunities for and barriers to integrated reporting and examples of good practice.

The current state of climate change related disclosure

In the face of the threats and opportunities presented by climate change to society as a whole, enterprises have to respond to increasing demands from governments, investors and other stakeholders to measure and disclose their greenhouse gas (GHG) emissions, as well as information about their exposure to climate change risks and new business opportunities.

The requirement to deliver information can form part of a policy instrument that aims to incentivize enterprises to reduce their GHG emissions, (such as carbon taxes and emission trading schemes), or feature in corporate governance provisions that explicitly or implicitly require companies to make climate change-related disclosures in annual securities, company or financial filings. Investor initiatives that encourage disclosure of corporate GHG emissions as well as risks and opportunities associated with climate change have also gained importance. On the supply side, a growing number of companies see measuring and disclosing climate change-related information as an important element of their corporate strategy and management.

At present, however, there are no internationally agreed standards for reporting corporate climate change-related information. This leads to variations in methodologies, scope and boundaries of reported information, which in turn limits comparability and usefulness, leading to doubt about its quality and reliability. It also increases the cost of climate change reporting for enterprises, especially for those operating in multiple jurisdictions, and may deter smaller, resource-constrained companies from preparing emission inventories.

To address these concerns, the project partners are calling for, or taking action to, encourage greater consistency of approach to the demand and supply of climate change-related information.

To learn more about the current state of climate change related disclosure please read the paper presented by CDSB to UNCTAD's Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting. This study, entitled Inventory of National and Regional Developments on Climate Change Related Disclosure, provides a review of climate change related reporting requirements within a sample of countries from around the world.