When I stepped into the Chair’s role at the Corporate Reporting Dialogue in early 2017, I could not have imagined what we would have achieved as a group of global standard setters. At that time, we were a dialogue in a literal sense and so I was excited to see the willingness of the participants to work together towards greater alignment in a joint project. The Better Alignment Project, started in 2018, is the result of the joint view of the Corporate Reporting Dialogue participants that it was desirable to further the alignment between their frameworks and standards.
This report is the first deliverable of the project and I am delighted with the results presented. As you will see, the actual alignment of the frameworks and standards against the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and between one another is much higher than envisaged prior to the start of the project.
Moreover, the Better Alignment Project has strengthened the Corporate Reporting Dialogue in a number of ways. The Corporate Reporting Dialogue’s profile has increased significantly. We have been invited at increased frequency to share insights and provide inputs, and relationships with critical senior stakeholders have intensified. The connections and cooperation between the operational teams of the global standard setters have also further developed significantly. This has not only led to a much deeper understanding of each other’s frameworks and standards, but has proven to be a strong basis for future work. The Better Alignment Project has set the ground for a long-lasting change in the reporting landscape.
But greater alignment is needed, and it will not be easy – it will be a long-term process. Each organisation has its own governance and due process in place to fulfil their purpose, serving their stakeholders’ needs. This will have to be taken into account in harmonising the reporting landscape.
Whilst we have met good understanding of the different purposes and audiences of the frameworks, we also have had consistent feedback from a number of our constituents that what is really needed is one strong, internationally-recognised and used set of standards for environmental, social and governance (ESG) reporting. The Better Alignment Project may not be able to resolve this issue in its present form. The participants, however, are committed to contribute where possible within the remit of the Corporate Reporting Dialogue to a better understood and user-friendly reporting landscape on the basis of their global frameworks and standards. I look forward to continuing that work in the second year of the Better Alignment Project.
Chair, Corporate Reporting Dialogue