ECONOMYNEXT – While more Sri Lankan corporates are taking sustainability disclosures more seriously, reporting rigorously on environmental impacts is still lacking, the Centre for a Smart Future (CSF) has said.
“A prevalent issue is the focus on compliance-driven reporting rather than meaningful impact, with many companies treating reporting as a tick-box exercise rather than integrating sustainability into their core operations,” Medhini Igoor, a researcher at CSF said.
The CSF report titled ‘Acronyms and Accountability: Strategic Insights on Corporate Environmental Disclosures in Sri Lanka’, proposes several actions to enhance sustainability reporting in Sri Lanka.
The full statement is reproduced below:
Companies underprepared for rigorous environmental reporting, but strategic interventions can drive impact: CSF report
New research by Colombo-based think tank Centre for a Smart Future (CSF) has shown that even as more Sri Lankan corporates are taking sustainability disclosures more seriously, reporting rigorously on environmental impacts is still lacking.
In a report titled ‘Acronyms and Accountability: Strategic Insights on Corporate Environmental Disclosures in Sri Lanka’ , CSF has shed light on the state of environmental reporting among publicly listed companies in Sri Lanka.
The report highlights the complexities of reporting, local nuances, capacity-building needs, and strategic interventions required to enhance transparency and accountability in corporate environmental disclosures.
Publicly-listed companies in Sri Lanka have to now mandatorily report their environmental metrics, with the rolling out of the new SLFRS S1 and S2 sustainability standards.
However, many companies struggle with data collection, particularly for Scope 3 emissions, and lack internal capacity to implement such comprehensive reporting frameworks.
“A prevalent issue is the focus on compliance-driven reporting rather than meaningful impact, with many companies treating reporting as a tick-box exercise rather than integrating sustainability into their core operations”, observed the report’s author Medhini Igoor, a Researcher at CSF.
The report emphasizes that building strong internal capacity is crucial for meaningful sustainability reporting – “Key organisational drivers, including top management, a trained sustainability team, and cross-departmental alignment play a crucial role in embedding sustainability into core business operations”.
Additionally, the report proposes several strategic actions to enhance sustainability reporting in Sri Lanka.
These include leveraging the expertise of the stock exchange and accounting bodies to drive standardization and consistency in reporting frameworks.
The introduction of a sector-specific, incremental approach to sustainability reporting is recommended, prioritizing export-oriented companies and gradually expanding compliance requirements.
The report also suggests establishing an annual Sustainability Reporting Index, which would provide a benchmarking tool to assess corporate performance in environmental disclosures, fostering greater accountability and transparency.
Furthermore, the role of the National Green Reporting System (NGRS) is critically reviewed, with recommendations for its revitalization to support Small and Medium Enterprises (SMEs).
The full report can be accessed on the CSF website. (Colombo/Feb5/2025)
