2. Definition of Sustainability Report
Sustainability reports are disclosures about the economic,
environmental, and social impacts caused by an organization's
operating activities that are reported to be integrated with corporate
reporting.
Sustainability reports reveal the relationship between strategy and
organizational commitment to environmental, social, and economic
sustainability globally (Sweeney, 2013).
The main focus in the presentation of a sustainability report is on
the way the business is run, with greater attention being paid to how
the business impacts the economy, the environment and society
3. Benefits of Sustainability Report
Disclosure of sustainability reports in corporate reporting is
beneficial for the organization itself, because it can provide guidance
for organizations in managing economic, management, social,
ethical, and environmental resources and is useful in terms of
improving product quality, operational effectiveness, and efficiency.
The sustainability report also has benefits as a means of
promotion, improving risk assessment, fostering social responsibility,
preserving the environment, strengthening governance, and
standardizing business sustainability.
4. Benefits of Sustainability Report
The results of research on 141 respondents, consisting of 21 company
managers, 55 company employees, and 65 consumers and investors, show the
benefits of sustainability reports. Where the first, the results of the data analysis
show a positive relationship between sustainability reporting and company
performance. Second, both consumers and investors tend to buy products from
green corporations (companies that have environmental responsibility)
(Ekwueme et al., 2013). In fact, the results of this study show that sustainable
reporting reduces the risk of litigation posed by social and environmental claims
on companies
5. Sustainability Reporting Standards
The Global Reporting Initiative (GRI) is a non‐profit organization formed in
1997 in the city of Boston, United States, which aims to make this organization
an institution that reviews and formulates global corporate reporting standards.
This organization is a combination of the Coalition for environmentally
Responsible Economies (CERES) and the Tellus Institute, under the supervision of
the United Nations Environmental Program (UNEP).
The standards for preparing sustainable reporting based on the Global
Initiative Reporting (GRI) G4 Guidelines and GRI Standards explain in more detail
the three dimensions, namely economic, social and environmental, into topic‐
specific standards (Global Reporting Initiative, 2016; Global Sustainability
Standards Board, 2016).
6. SR REGULATIONS
Sustainability reporting itself is regulated in the Financial Services Authority
Regulation Number 51 / POJK.03/2017 concerning the Implementation of
Sustainability Reports for Financial Services Institutions, Issuers, and Public
Companies.
This regulation states that every Financial Service Institution (LJK), Issuers and
public companies listed and listed on the Indonesian stock exchange are
required to make a sustainability report. If the LJK, Issuer and public company
violate it will be subject to administrative sanctions in the form of a warning or
written warning. More about this source textSource text required for additional
translation information
7. GLOBAL REPORTING INITIATIVE (GRI)
Standards for preparing continuous reporting based on GRI 4 are divided into two types,
namely general disclosure standards and specific disclosure standards...
The general standard contains seven components that must be presented in the disclosure of
sustainability reports, including:
1. Strategy and analysis
2. Organizational profile
3. Identified material aspects and boundaries
4. Relationship with stakeholders
5. Report Profile
6. Governance
7. Ethics and Integrity
GRI also has specific disclosure standards, which are divided into three categories, namely economic,
environmental and social.
8. Standard Aspects of Sustainability Reporting
1. Economy
The economic aspects discusses the interrelationships of the impact generated by the
organization on the economic condition of the company and the economic system at the
local, national and global levels.
This aspects is divided into seven aspects, namely: economic performance, market
presence, indirect economic impact, procurement practices, anti‐corruption, anti‐
competitive behavior and taxes.
2. Environment
The environmental apects, broadly speaking, this apects discusses the relationship
between the impacts generated by the organization on a natural system, both living and
non‐living, including water, air, soil and ecosystems.
Aspects owned by the environmental aspects, among others: material, energy, water and
effluent, biodiversity, emissions, wastewater (effluent) and waste, environmental
compliance and environmental assessment of suppliers.
9. Standard Aspects of Sustainability
Reporting
3. Social
The social aspects discusses the impact produced by the organization on the
social system in which the organization is operating.
Aspects possessed by the social aspects, among others: employment,
labor/management relations, occupational safety and health, training and
education, diversity and equal opportunity, non‐discrimination, freedom of
association and collective bargaining, child labor, forced or compulsory labor ,
security practices, indigenous peoples' rights, human rights assessment, local
communities, supplier social assessment, public policy, customer health and
safety, marketing and labeling, customer privacy and socioeconomic compliance.
10. Sustainable Reporting Practices
Based on research conducted in 2005 on the effect of sustainable reporting on several
measures of responsible management practices on social impact on companies in 58 countries
in the world, it shows that after adopting sustainable reporting rules and standards, there is an
increase in the social responsibility of corporate leaders.
In 2011, a study on company decisions in reporting sustainability reporting was influenced by
many micro, macro, cultural, and even other global factors. This research, which was conducted
by 309 companies from around the world, shows that the factors of the political, financial,
educational, and labor systems, culture, and economic systems influence the company's decision
to report its sustainability report (Jensen & Berg, 2012).
11. Sustainable Reporting Practices
Banking, a business sector that has very strict regulations, and has
broad stakeholder aspects makes corporations in this sector better in
implementing sustainable reporting.
Based on research on 235 banks from around the world for 10
years (2007‐2016), sustainability reporting in banking corporations
affects the company's profitability (Bually, 2019). More about
banking
