It is encouraging to see industry leaders calling for harmonized metrics for the UN Sustainable Development Goals (SDGs). Brian Moynihan is on the right track concerning the need for harmonized metrics for the SDGs, not just for ESGs which are only a subset of the SDGs and for which, as he correctly points out, there is an ‘Alphabet Soup’ of acronyms representing different measurement systems created by the various NGOs.
The good news is harmonized metrics for the SDGs already exists.
UNCTAD, part of the UN Secretariat, whose main function is data collection and analysis to facilitate public policy, created the Global Core Indicators (GCIs) through a multi-year, multi-stakeholder effort by governments, regulators, standard-setting agencies and investors. Reporting under these standards will be required by global national statistical offices and regulators. These standards will be used by over 100 countries who are members of UNCTAD- ISAR (International Standards of Accounting and Reporting), with many more signing on, and will require firm entity-level reporting on their contributions to the SDGs. The GCIs are a common set of standards which fulfill all of the quantitative requirements – consistent, comparable, material, universality etc. – and also facilitate convergence of financial and non- financial reporting, something none of the other measurement systems do, making the GCIs suitable for consolidated, integrated reporting and legal entity reporting. UNCTAD’s framework and standards are also consistent with TCFD and can be the implementation tools for TCFD. Moreover, the standards will link firm-level reporting into national statistics and reporting and help inform where capital needs to be redirected to achieve the SDGs.
Good to see the US corporate leadership stepping up to the plate on SDGs. My only hope is the US gets on board with the rest of the world and not create its own SDG reporting metrics which will further fragment the ecosystem. The US needs to be an active participant in the global economy looking to help solve global problems. We should join the rest of the world in reporting under the GCIs.