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The Convergence of Global ESG Reporting Frameworks Part 3

In a business climate increasingly focused on sustainability and ethical operations, Environmental, Social, and Governance (ESG) reporting has become a crucial element of corporate transparency and accountability. Amidst the mounting pressure from investors, customers, and regulators, ESG reporting enables companies to showcase their commitment to sustainable, ethical, and responsible business practices.

For organizations with an international footprint, the significance of understanding and navigating country-specific ESG reporting requirements cannot be overstated.

In this last installment of our Convergence of Global ESG Reporting Frameworks series, we’ll delve into what ESG requirements are by country. With so many different ESG reporting frameworks and requirements, it can be tough to navigate and make sense of it all. Luckily, we’re here to help.

What is ESG Reporting?

ESG reporting refers to the disclosure of data by businesses on a wide range of practices and performances related to environmental stewardship, social responsibility, and corporate governance. This form of reporting provides insights into a company’s approach to managing risks and opportunities related to sustainability issues.

Benefits of ESG Reporting:

Trees between buildings

What is difference between ESG frameworks and standards?

The distinction between ESG frameworks and standards is crucial for companies as they navigate the landscape of sustainable reporting. ESG frameworks and standards serve complementary but distinct roles in guiding organizations on reporting their sustainability performance.

ESG Frameworks are essentially broad systems or sets of guidelines that organizations can use to structure and manage their ESG reporting. They provide the general outline or ‘framework’ for reporting, focusing on the types of information a company should disclose to stakeholders about its sustainability practices. ESG frameworks are designed to be flexible, allowing companies to adapt their reporting to reflect their unique circumstances and sustainability priorities. They don’t prescribe specific indicators or metrics but rather suggest areas of disclosure.

ESG Standards, on the other hand, define specific metrics and indicators that organizations should measure and report. These are more prescriptive and detailed compared to frameworks, offering a set of uniform criteria that aim to make the disclosure of sustainability information comparable and consistent across similar organizations. Standards often serve as the technical foundation within the broader context provided by frameworks, specifying how to report on various ESG issues in a manner that is aligned with best practices.

What are some common ESG reporting frameworks?

  1. The Global Reporting Initiative (GRI) framework is expansive and covers a broad spectrum of ESG aspects, providing a comprehensive look at a company’s sustainability performance.
  2. The Task Force on Climate-Related Financial Disclosures (TCFD) framework zeroes in on the environmental aspects of ESG, particularly climate change, offering detailed guidance on disclosing climate-related financial information.
  3. The Climate Disclosure Standards Board (CDSB) framework emphasizes the environmental element of ESG, striving to normalize reporting on climate change and its implications.
  4. The International Integrated Reporting Council (IIRC) advocates for a cohesive approach to ESG reporting, encouraging the merging of various reporting standards and frameworks to capture the full scope of a company’s impact.

What are some common ESG Reporting Standards?

  1. The IFRS Sustainability Disclosure Standards, spearheaded by the International Sustainability Standards Board (ISSB). These standards aim to unify sustainability reporting on a global scale, enhancing financial market transparency.
  2. The Sustainability Accounting Standards Board (SASB) standards are designed to align closely with the IFRS standards, providing a comprehensive approach to sustainability reporting.
  3. The European Financial Reporting Advisory Group (EFRAG) standards are dedicated to integrating sustainability and financial reporting, highlighting the importance of both aspects in corporate transparency.
Water colour map of world

What are the country specific reporting requirements for ESG?

North America

The Canadian Sustainability Standards Board (CSSB) is set to launch a public consultation to advance the adoption of sustainability disclosure standards in Canada. In March 2024, the CSSB will issue proposals on its first standards, Canadian Sustainability Disclosure Standards (CSDS) 1 and 2, which align with the global baseline standards developed by the International Sustainability Standards Board (ISSB) but with Canadian-specific modifications.

Canada’s Modern Slavery Act, is legislation aimed at eradicating forced labor and child labor in Canadian corporate supply chains; became law on January 1, 2024. Tackling human rights violations, especially forced labour and child labour, is a critical element of corporate sustainability, attracting increased focus in recent years. The Modern Slavery Act in Canada has been passed with the objective of protecting consumers from inadvertently supporting slavery due to insufficient information about the ethical integrity of the supply chains behind the goods that they purchase.

United States of America

The Securities and Exchange Commission (SEC) has recently made a pivotal move by requiring US-listed companies to communicate how they are managing material risks related to climate change and how those risks affect their bottom lines.

These new reporting requirements allow investors more transparency into the threat climate change poses to U.S. publicly listed companies, and how they contribute to a warming planet via emissions.


The Corporate Sustainability Reporting Directive (CSRD) is a recent EU initiative to institutionalize the sustainability reporting process for companies within its jurisdiction. The advent of CSRD turns a new leaf in the sustainability narrative, helping to standardize data and ensure that we all speak the same language regarding a company’s ecological, social, and governance track record.

This increased transparency plays a crucial role in evaluating financial risks and opportunities, notably those exacerbated by climate change and other sustainability concerns. These new regulations will affect companies from the 2024 financial year which means that businesses must prepare and adapt for successful compliance in reports published in 2025.

United Kingdom

In the UK legislative landscape, specific companies are legislatively obligated to disclose financial information pertinent to climate change within their annual strategic reports under TCFD since 2021. This rule predominantly applies to corporations exceeding the thresholds of 500 employees or reporting annual turnovers surpassing £500 million.


In France the Law on Energy and Climate (2019) requires portfolio management companies to report their policy on the inclusion in their investment strategy of ESG criteria, and the means implemented to contribute to the energy and ecological transition, available to their subscribers and to the public; as well as a strategy for implementing this policy.


Japan has long stood out as a leading nation for corporate commitment to climate change with a vast array of companies endorsing the Task Force on Climate-related Financial Disclosures (TCFD). Reflecting its proactive stance on environmental transparency, the Tokyo Stock Exchange (TSE) took significant steps in June 2021 by amending the Corporate Governance Code. This amendment mandates Prime Market-listed entities to embrace TCFD reporting and delve into social issues, adopting a “comply-or-explain” approach.

In 2023, the Financial Services Agency (FSA) introduced groundbreaking rules, marking an initial phase towards compulsory disclosure of sustainability information. These regulations require all listed companies in Japan, which total around 4,000 including international firms listed on Japanese exchanges, to incorporate a dedicated segment for sustainability-related data within their annual securities report. This segment covers the four core areas of TCFD: Strategy, Metrics and Targets, Governance, and Risk Management, thus ensuring a comprehensive disclosure of climate-related financial information.


In February 2024, it was announced that China had formalized ESG reporting requirements for 3 of the country’s leading stock exchanges in Beijing, Shanghai, and Shenzhen. The establishment of these guidelines not only elevates the standards for corporate responsibility within China but also has far-reaching implications for the global business ecosystem, considering China’s pivotal position in international supply chains. Approximately 450 public-traded companies operating within China, including foreign entities, must now adjust to this emerging regulatory environment, which is swiftly becoming the standard for sustainable business practices worldwide.

Wind Turbine and Solar panels

How are ESG reporting requirements vital for businesses?

Understanding and complying with country-specific ESG reporting requirements are vital for businesses operating in the global marketplace. It not only ensures regulatory adherence but also symbolizes an organization’s commitment to corporate citizenship. By integrating ESG practices into their operations, companies can unlock new opportunities and enhance long-term sustainability.

As a specialized consultancy service, Shift Critical leverages its expertise and insight to guide companies through the maze of ESG reporting. From compliance assurance to strategic planning, Shift Critical offers services designed specifically to demystify ESG regulations. They ensure your company is up-to-date with evolving standards and equipped to thrive in a world where sustainability is increasingly important.

Given the dynamic nature of ESG reporting standards, regular updates and consultations with compliance experts are recommended for businesses to stay ahead of the curve.

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