Capitals Coalition hosts the Digital Sustainability Disclosures Project (The DSD project), a three-year collaborative initiative. This ambitious undertaking aims to forge a universally accepted global digital data exchange framework, rallying stakeholders around a common purpose. The DSD Project ultimately aims to innovate how we create sustainability-related machine-readable data and streamline the dissemination of information to enhance society’s well-being.
The Digital Sustainability Disclosures Project (The DSD Project) aims to elevate the significance of digital sustainability disclosures, rendering them pertinent and valuable in the realm of investment decisions by both corporate leaders and investors. This transformative potential can only be harnessed if these disclosures attain a level of informational integrity akin to traditional financial reporting, harmoniously intertwining with financial data. The DSD Project and contributors commit to identifying the missing links within the reporting value chain and catalyzing their resolution to closing gaps that hinder progress.
Vast quantities of sustainability data are generated every day from a wide range of organizations around the world. Sustainability data flows between many players and across a global landscape from the point of creation through the point of consumption. But, as data moves through this information flow system, it runs up against numerous barriers.
In many cases this data is challenging to locate, fragmented, devoid of context, created using unaligned definitions and vocabularies and is presented in a vast array of different formats, many of which are largely incompatible. Large quantities of data are not digitalized at all, some systems are manual, and consequently lots of important decision-relevant information falls between the cracks. The result: trusted data is lacking.
Data auditability remains a significant challenge, and subsequently information is often not as useful as it needs to be for organizations to make integrated, data-driven decisions based on the value of their impacts and dependencies across the capitals.
This information system challenge places a significant financial burden directly on organizations and other stakeholders. The financial services industry alone spends almost 800 billion USD each year managing data for compliance purposes alone. Extrapolated globally across all industries, trillions of dollars are spent each year on compliance activities that offer limited value to organizations and stakeholders. With a more robust and effective system, data becomes trusted and decision useful and compliance can be met while freeing up the cost savings which can be reinvested in initiatives that deliver value across the capitals.
Solving the challenges around digitizing sustainability information flows is larger than the industry can solve on its own. What is needed is for key players across the global system to collaborate under a common objective: actively collaborate towards an agreed global digitized data management structure for sustainability, treating sustainability data with the same or better control, governance, transparency and assurances as that of financial statement data disclosures.
The aim of this project is not to reinvent the wheel, but to drive global collaboration between the key systems and organizations within the current landscape. Together we will ensure that data can flow effectively across the system and that it will supply the information that organizations and stakeholders need to make better informed decisions that deliver value for nature, for people and for their organizations.