What is the sustainability report

A question that more and more companies are asking, a question that is now on the agenda and is increasingly becoming a real priority. In this blog article you will find a summary created by Gea Factory Ltd. Benefit Society which explains what a sustainability report is and its reporting, strategic and business significance. A sustainability report is a corporate reporting document through which a company communicates and declares its ESG performance and the progress it has made in ecological/environmental, economic and social areas.
ESG means a true sustainability rating being precisely the acronym for Environmental Social Governance. The purpose of the Sustainability Report is to inform stakeholders (individuals involved in an economic activity) of the economic, social and ecological/environmental generated by the company in carrying out its activities. That said, let us delve together into the three areas just mentioned above:

• Ecological/environmental scope: how and how a company uses natural resources and what is its environmental impact.
• Economic scope: how a company generates and how it distributes wealth, growth at the economic level and at the level of innovation.
• Social sphere: protection of workers' and women's rights, elimination of inequalities on health, resources, education and justice.

What is the purpose of the sustainability report?

The purpose of the sustainability report is to report and communicate to corporate stakeholders the quantitative and qualitative results of the company's ordinary and extraordinary management in the ecological/environmental, social and economic spheres.

What is a sustainability report? An updated guide to better understand what it is
When a company decides to report on sustainability aspects, it can opt for two different alternatives:

• Draft an integrated report where non-financial aspects and financial aspects are part of the same document
• Separate information and publish a separate non-financial statement, i.e., the sustainability report

Producing a sustainability report also means adopting a strategic method that can communicate goals and performance to its stakeholders with extreme transparency. It also allows the company to stand out from the competition and demonstrate a strong commitment to sustainability to customers.

Benefits of the sustainability report

Let's find out together what the benefits of sustainability reporting are:

• Meeting the information needs of the stakeholder
• Engaging stakeholders in a way that enhances corporate reputation
• Improve corporate communication of environmental, social and economic commitments
• Reduce consumption and waste
• Respect the environment and value the land
• Improve bank rating
• Premiums for subsidized finance
• Define and implement a sustainability program.

The stages of the sustainability report

In order to draw up the sustainability report, it is necessary to know each and every stage of the
process:

• Initial screening
• Documentary analysis
• Interviews with corporate governance
• Stakeholder engagement
• Drafting the Sustainability Report

Who prepares the sustainability report?

The sustainability report is carried out by companies that are competent and specialized in this kind of field. Gea Factory Ltd. Benefit Society offers this kind of service with professionalism, competence and passion.

Is the sustainability report mandatory?

As of April 21, 2021, with the Corporate Sustainability Reporting Directive (CSRD), the process has begun to arrive, starting in 2024,
to the extension of the sustainability report requirement to all large companies listed on European regulated markets.
This category includes all enterprises that, as of the balance sheet date, meet at least two of the following requirements:

• 250 average annual staff
• 20 million euros in total assets
• 40 million euros in sales

This directive also includes non-European companies that are listed on European markets. Small/medium-sized listed companies will have to comply with the obligation with application from January 1, 2026. Unlisted small/medium-sized companies currently prepare the Sustainability Report on a voluntary basis for the benefits listed above or because they belong to the supply chain of companies that are already obligated, which in turn, require them to produce information for compliance with European regulations.

Conclusion: Why the Sustainability Report is important for your
company?

The sustainability report is, therefore, of fundamental importance because it is a reporting and communication tool, expendable also for commercial and financial purposes, that is absolutely in line with current market requirements. Moreover, this tool helps the company put its strategic environmental, social and economic sustainability goals at the center of its business plans.

If you intend to discuss this further and would like to book your consultation, you can contact us.