GRI seeks feedback on new financial services reporting standards

The Global Reporting Initiative (GRI) is inviting sustainability leaders to provide feedback on its draft standards for banking, capital markets and insurance firms.

These are the first GRI standards for the financial sector, and they “recognise the central role of financial institutions in promoting sustainable business models and underpinning a well-functioning global economy”. GRI is running a public consultation on the drafts until May 31.

Sustainability leaders in the financial sector and beyond are invited to attend one of the organisation’s webinars on the topic on March 25 and 27, and fill out an online questionnaire to share their thoughts on the exposure drafts.

“Financial services organisations are global mobilisers of capital and resources and are uniquely positioned to support a sustainable economy and encourage companies to transparently disclose their most significant impacts. The GSSB looks forward to receiving insightful feedback from stakeholders to help us deliver world-class Sector Standards for banking, insurance and capital markets,” said Carol Adams, Chair of GRI’s Global Sustainability Standards Board (GSSB).

Bank climate disclosures

The new financial sector standards aim to “provide a sustainability context for a sector, outline material topics and list relevant disclosures, and help companies understand stakeholders’ expectations”, GRI notes, adding that “more consistent reporting on sector-specific impacts increases transparency, accountability and comparability”. 

Relevant topics to be disclosed based on the banking sector reporting draft, for example, include climate impacts, adaptation plans, sector-specific targets for high-emitting segments of financing portfolios, as well as the monetary value of investments and loans that are affected by these targets.

When reporting Scope 3 emissions, banks should also include: financed emissions and facilitated (capital market) emissions, with a breakdown by asset class and sector, as well as the monetary value of the lending and investment portfolios covered by the calculations, according to the standard exposure draft.

Pushing for more integrity at a time of diminishing climate focus

GRI standards are not mandatory, but as a widely accepted standard-setter across industries, the organisation is a strong driver of integrity in sustainability reporting. 

The financial sector standards come at a time when many banks appear to be retreating from their climate commitments to refocus on profits. This week, Wells Fargo was the first US bank to abandon its net zero target for financed emissions – a move that was qualified as “cowardly and shortsighted” by NGOs.

Other banks could soon follow suit: when Goldman Sachs exited the Net Zero Banking Alliance last December in the wake of the US presidential election, it was shortly followed by most of Wall Street, as well as Canadian and Australian banks.

“In a rapidly evolving macroeconomic landscape, it is more critical than ever to equip capital markets with relevant guidance that can support them in identifying their impacts and financing the transition to a sustainable global economy,” said Daniele Spagnoli, former Vice President of ESG Methodologies at Moody’s and member of GRI's Capital Markets Technical Committee.