Sustainability reporting is important across all sectors and business sizes. However, for some companies and sectors, sustainability reporting has become more critical. Here are some types of companies that need to prepare sustainability reports:
Large-Scale Companies
Large-scale companies typically have a broad stakeholder base, and their activities have significant environmental and social impacts. For these companies, preparing sustainability reports is crucial to demonstrate their commitment to societal responsibilities. Additionally, large-scale companies are often subject to legal regulations, making sustainability reporting a requirement.
Companies in High Environmental Impact Sectors
Companies operating in sectors with high environmental impact, such as energy, mining, chemicals, textiles, and construction, must engage in sustainability reporting. Their activities use natural resources intensively and have significant environmental effects. Sustainability reports are an important tool for communicating strategies to manage and mitigate these impacts to the public.
Small and Medium-sized Enterprises (SMEs)
Small and medium-sized enterprises (SMEs) can also benefit from sustainability reporting. Although SMEs may not have as broad an impact as large companies, they still have significant effects on local communities and markets. Sustainability reporting helps SMEs achieve their sustainability goals and gain a competitive advantage.
Consumer-Focused Companies
Companies in sectors such as consumer products, retail, and food must engage in sustainability reporting. These companies need sustainability reports to meet consumer expectations on sustainability and to enhance brand trust. Consumers want to know the environmental and social impacts of the products they purchase.
Public Institutions and NGOs
Public institutions and non-governmental organizations (NGOs) must also engage in sustainability reporting. As organizations that serve the public and use public resources, they are required to demonstrate the sustainability and transparency of their activities. Sustainability reporting increases accountability and proves their commitment to societal responsibilities.
Companies Critical for Investors
Companies in financial services, banking, and investment sectors, which are critical for investors, must also engage in sustainability reporting. These companies evaluate and report the environmental and social impacts of their investments to their stakeholders. Investors are increasingly focusing on investing in companies that meet sustainability criteria.
While different regions have various regulations, there are general criteria for determining which companies need to do sustainability reporting.
European Union (EU)
The EU has some of the strictest regulations on sustainability reporting. Regulations such as the NFRD (Non-Financial Reporting Directive) and CSRD (Corporate Sustainability Reporting Directive) require certain-sized companies to engage in sustainability reporting.
In this scope
- Large companies with more than 500 employees
- Publicly traded companies
- Banks and insurance companies have to report.
Switzerland
Sustainability reporting in Switzerland has been of increasing importance in recent years and has become mandatory in certain sectors. According to the regulations in Switzerland:
- Large-scale companies and publicly listed companies,
- Financial institutions and insurance companies,
- Companies operating in sectors with high environmental impact are required to assess and report their sustainability performance.
Switzerland’s sustainability reporting regulations are in line with international standards and ensure that companies act in accordance with the principles of transparency and accountability.
Turkiye
The Turkish Sustainability Reporting Standards (TSRS) have made sustainability reporting mandatory for certain sectors and companies in Turkiye. According to Turkish regulations:
- Companies listed on Borsa İstanbul
- Banks and insurance companies
- Companies operating in sectors with high environmental impact
These companies are required to prepare sustainability reports in compliance with TSRS.