The United Nations Development Programme (UNDP) has announced a partnership with the Global Reporting Initiative (GRI), the Global Steering Group for Impact Investment (GSG), the IFRS Foundation, and the International Organization for Standardization (ISO).
This coalition aims to establish Sustainability Disclosure and Management Hubs (SDMHs) across 14 developing and emerging economies, focusing on improving sustainability reporting and management.
Unified Effort for Global Sustainability
The establishment of SDMHs marks a significant expansion of existing partnerships, particularly the one between UNDP and the IFRS Foundation’s International Sustainability Standards Board (ISSB), initiated at COP27 in 2022.
The hubs will help facilitate the adoption of comprehensive sustainability standards including IFRS S1 and S2, GRI Standards, and ISO management standards.
Objectives and Strategic Focus
The Sustainability Disclosure and Management Hubs (SDMHs) initiative is designed with several key objectives to drive its mission forward:
Enhance Sustainability Disclosure: Improve the quality and consistency of sustainability reports, ensuring transparency, accountability, and comparability in sustainability practices. This objective is crucial for fostering a transparent global sustainability landscape.
Support Developing Economies: Address the unique challenges faced by developing economies by providing tailored support. The initiative aims to bridge gaps in sustainability reporting and management, helping these regions catch up with global standards.
Promote Global Standards: Align with international standards from ISO and the IFRS Foundation to ensure that disclosed information is reliable and comparable across borders. This alignment will foster a cohesive approach to global sustainability efforts.
Capacity Building and Training: Offer extensive training programs and resources to local businesses and governments, enhancing their skills and knowledge in sustainability reporting. This capacity building will empower local entities to manage and report sustainability efforts effectively.
Alignment with National Priorities: Integrate sustainability efforts with local development goals, ensuring that sustainability initiatives support and complement broader national development strategies.
Guidance and Regulation Development: Provide stock exchange guidance and develop necessary regulations to support sustainability initiatives. This will create a robust regulatory framework to sustain long-term sustainability efforts.
By combining these objectives, the SDMHs aim to create a comprehensive support system for developing and emerging economies, enhancing their ability to meet global sustainability standards while addressing local challenges and priorities.
This holistic approach ensures that sustainability practices are not only implemented but also aligned with the broader economic and social goals of each country.
Phased Implementation Plan
The hubs will be launched in two phases. In 2024, pilot projects will begin in six countries within Latin America, the Caribbean, Africa, and Asia.
These projects will focus on capacity building, national development priorities, stock exchange guidance, and regulatory development, in collaboration with UNDP Financial Centres for Sustainability Network (FC4S) Members.
By 2025, the initiative will expand to cover an additional eight countries, bringing the total to 14.
Key Statements from Leaders
Marcos Neto from UNDP expressed enthusiasm about the initiative:
“This is a remarkable step forward in advancing global sustainability standards. The SDMHs will empower developing economies to improve their sustainability practices and align with their national development priorities”.
Jingdong Hua from ISSB highlighted the global importance of these hubs, stating,
“The introduction of ISSB Standards globally can help deliver consistent and comparable information to investors, advancing the understanding of sustainability-related risks and opportunities”.
Peter Paul van de Wijs of GRI emphasized the increasing pressure on global value chains to provide reliable sustainability data:
“This initiative supports companies and governments in understanding how our various disclosure mechanisms and frameworks complement each other to increase transparency and support sustainable development”.
Sergio Mujica from ISO underscored the power of combined standards:
“By demonstrating the connection and interoperability between them, we will build capacity in developing and emerging economies to manage sustainability disclosures more effectively and efficiently” .
Nick Hurd from GSG Impact highlighted the importance of inclusivity in global sustainability efforts:
“We expect this initiative to ensure adequate levels of inclusivity from key stakeholders in emerging economies, advancing wider impact transparency”.
Impact and Future Prospects
The establishment of Sustainability Disclosure and Management Hubs represents a transformative step in global sustainability efforts.
By supporting developing economies in their sustainability reporting and management, this initiative promises to foster greater transparency, accountability, and sustainable development.
As global sustainability requirements become more stringent, these hubs will play a crucial role in helping all economies participate effectively in global efforts, driving meaningful progress towards a sustainable future.
Enhancing Sustainability Disclosure in Developing Economies
This collaboration between UNDP, GRI, GSG, IFRS Foundation, and ISO to establish SDMHs is poised to make a significant impact on global sustainability practices. By fostering capacity building, aligning with national priorities, and promoting global standards, the initiative will enhance the quality and consistency of sustainability reporting.
As the world moves towards more rigorous sustainability requirements, these hubs will ensure that developing economies can participate fully and effectively in this global effort, contributing to a more sustainable and equitable future.
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