12 December 2022

IFC, CDP, SSE launch new report on environmental disclosure policies

The report (developed in consultation with UN SSE initiative) also highlights practical examples for developing high-quality regulation that addresses market needs and investor demands, helping to mobilize private capital flows towards sustainable solutions.

IFC (a member of the World Bank Group) and CDP (a not for profit which runs a global environmental disclosure system) released a report analyzing the current state of best practices in environmental disclosure, examining more than 100 disclosure practices across developed and developing economies.

The report, which was developed in consultation with the United Nations Sustainable Stock Exchanges (UN SSE) initiative, also highlights practical examples for developing high-quality regulation that addresses market needs and investor demands, helping to mobilize private capital flows towards sustainable solutions. Download the report here

Voluntary disclosure of environmental action has accelerated rapidly as companies seek to attract sustainable investment opportunities and reduce their environmental impacts. In 2022, nearly 20,000 organizations disclosed sustainability-related information through CDP – a 38% increase from 2021. Additionally, 67 stock exchange members of UN SSE have written guidance on environmental, social and corporate governance reporting.

Of these 33 markets are also subject to mandatory ESG disclosure rules.  "The growth in voluntary disclosure in recent years is overwhelmingly positive. Yet, in the face of the climate and environmental crises, we recognise that voluntary disclosure is no longer enough," said Pietro Bertazzi, Global Director for Policy Engagement and External Affairs at CDP. "This report will be vital in ensuring that governments develop policies that can truly drive forward the environmental agenda, track their own progress towards targets and boost ambitious action in the real economy. Robust and ambitious mandatory disclosure regulation will help all actors to better understand and act on not just the risks facing them, but the opportunities in front of them as well as their impacts on people and planet."

The report examines environmental policies and practices against five criteria set out by CDP on mandatory disclosure requirements, including: addressing sustainability-related financial disclosures, as well as impact on people and the planet; ensuring compatibility of disclosure standards either required or recommended; providing a system of enforcement; adhering to technical quality and content; and allowing space for innovation. The assessments covered in the report also consider IFC's comprehensive approach to addressing the corporate governance and regulatory environment, including codes, scorecards and reporting guidelines.

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