About this ATALK
In this insightful episode of ATALKS, we delve into the world of sustainability and business with Kim Kastorff, founder of Kimpacto. Key highlights include:
✅ B Corp Movement: Discussion on the B Corp certification, its significance, and Kim’s experience with it.
✅ Evolution in Sustainability Reporting: How sustainability reporting has changed over the years, with a focus on impact investing, and the role of B Corp and UN SDGs in shaping the field.
✅ Corporate Sustainability Reporting Directive (CSRD): An in-depth look at the new CSRD in Europe, its implications for businesses, and the necessity for accurate sustainability reporting.
✅ Best Practices for CSRD Compliance: Strategies and tips for effective sustainability reporting in line with CSRD, including the significance of technology, third-party support, and the need for comprehensive approaches.
✅ Advice for Companies Transitioning to CSRD Compliance: Practical tips for organizations beginning their journey towards CSRD and ESRS compliance. This episode is a must-watch for professionals interested in sustainability, impact investing, and the latest regulatory changes in the field, particularly in the context of CSRD.
📚If you want more information about CSRD and ESRS, our comprehensive guide can help you. Download here the CSRD and ESRS guide: https://mtr.bio/csrd-esrs
Transcript
You can find the full transcript of their conversation below.
Andrés Cardona | Welcome to ATALKS, where sustainability has a voice. At APLANET, we created this space to showcase the path of professionals who already crossed the world that you are currently in. Today we have Carlota de Paula Coelho. She is a member of B Lab and has an extensive experience even on EFRAG and also with CSRD. Paula, you have an amazing experience, and I was really astonished for what I saw when we were in contact with you the first time. Can you tell us a bit about yourself? |
Carlota de Paula Coelho | Of course. Thank you, Andrés. I’m very, very happy to be here. So indeed, I’ve been working in the sustainability field for many years, first as a consultant. More recently, I’ve joined B Lab, which is a civil society organization which is also behind the certification of B Corp. But we’ll get to that in a second. And for almost two years now, I have also been a member of the technical expert group at EFRAG, which is the advisory organization to the European Commission, which drafts their reporting standards. And recently, I’ve had the pleasure of also joining a working group by GRI to review the standard on economic impacts. |
Andrés | Wow. Well, you’ve been all over the place, to be honest, in the sustainability field, to clarify, because maybe there’s someone who doesn’t know what EFRAG and CSRD and ESRS and GRI means, could you explain us a bit so we can level the field? |
Carlota | Oh, that’s fair. So, the CSRD, or Corporate Sustainability Reporting Directive, expands on the previous NFRD, the Non Financial Reporting Directive, which constitutes basically of compulsory disclosure requirements around sustainability matters for companies. Right? So EFRAG is the advisory organization to the European Commission that helps draft these reporting standards and that previously was entrusted to draft financial reporting standards. I guess that already gives you a bit of a sneak peek of what it is. And GRI is another reporting framework which is not embedded in legislation. It’s an older reporting framework that EFRAG actually has used to build on the ESRS, or european sustainability reporting standard. But to this day, for other countries outside of the EU who will not be using ESRS, they might resort to GRI, the Global Reporting Initiative Standards. |
Andrés | That’s amazing. And also, well, as of now, in 2024 and 2024, there’s a lot of companies who are going to have to report under CSRD. But how do you think all of these EFRAG, CSRD and ESRS affect those companies? |
Carlota | Right? So it’s a lot of four or five letter acronyms in the world of EU legislation, in the world of ESG disclosure frameworks. So, as you said, the CSRD implementation is phased in, but has already entered into force in 2024 for larger companies already in scope of the previous law, the NFRD, or as we know it in Spain. And it will have, you know, a staggered approach. And as of 2025, more companies will be in scope until SME’s will eventually get in scope or listed. SME’s, I should say, will also end up being in scope of these disclosure requirements. So maybe I should take a step back and explain just briefly that the CSRD, the directive, sets up the framework and imposes a series of obligations to companies, such as having to use the European Sustainability Reporting Standards, which are complementary to the CSRD, but are adopted as a delegated act. I’m just saying this because I know there’s a bit of confusion around the fact that there are two acronyms. As if one wasn’t complicated enough. Well, they do complement each other. So, the European Sustainability Reporting Standards are the standards themselves. They’re a comprehensive set of standards that cover environmental, social, and governance topics. The first set that was adopted last year is the sector agnostic standards. But currently, at EFRAG, we’re already developing sector specific standards. And on top of that, companies are also able to make entity specific disclosures. So there will eventually be three layers of reporting covering a wide range of sustainability topics, such as climate change, biodiversity, water owned workforce, affected communities, etcetera. Now, I do not say all this because I want everybody to succumb into a panic. Yes, these are exhaustive standards, and there are more to come. Okay? But let’s say that companies should take this one day at a time, and they should all start the same way, which is the materiality assessment, also known as the double materiality assessment. We do not expect each and every single company to report on the twelve sector agnostic standards. Okay? This is important. We do not expect, let’s say, a small service company to speak about impacts on biodiversity. Right? So this notion of materiality means that really, companies should conduct a very comprehensive assessment, an introspection, if you will, of where they have their most relevant, most material impacts, risks and opportunities. The difference between impact on one side and risks opportunities on the other side speak to this concept of double materiality. Double materiality means that companies are expected to look at sustainability from two, let’s say, lenses. First, they will consider the effects of their business activities on people and the planet, also known as impact materiality or the inside out perspective. But they will also be managing risks, and we’re talking financial risks or financial opportunities that arise basically from sustainability related issues that might impact their performance or their positioning on the market. So this is what we mean by outside in effect. And this can be, for example, if I am, you know, in the agriculture industry in Spain, in the south of Spain, where I know that there is a risk of water scarcity, this is not only a problem for my conscience that I’m may be harming the communities there, but it’s also, you know, a risk for my bottom line, for my, my business resilience, let’s say. Okay, so it was that clear, Andrés, a bit, this notion between, yeah, I. |
Andrés | Think one of the, and this is actually a question that a lot of people ask because when they, when, when they thought about maturity in 2019, for example, they were just thinking about what’s material from our stakeholders and how advanced or how develop do I have this within my company. So they had an understanding of maturity analysis just in one way and including the financial scope of mutuality and the impact inside out. And like, through my bottom line, sometimes it’s quite, I don’t know if you say complicated, but at least it’s hard to digest. So I think you explain it really well. The thing is, how do you translate this into action? You know, because how do you put this, and I know this is more like a consultancy question, but companies are super worried about, okay, but how do I make this tangible and create this matrix and create my arrows, you know, all of these, how do they do this? |
Carlota | Okay. I would say first by taking a deep breath. Okay. There is a lot of common sense involved here. Okay. So the first step is the materiality assessments. And for those companies that have already been conducting materiality assessment from an impact materiality lens, they will just have to build on that. Right? So you need to understand the context of your organization. Right? That’s the very first thing you want to do. You want to map your stakeholders. You want to map your business relationships upstream and downstream. You want to map the different kinds of activities. Maybe you’re operating in more than one sector, so just maybe starting with Miro or with excel on a pen and paper, but try to have a very good understanding and not your stakeholders. Right? Who you’re, what, what did they expect from you and how do you affect them? To have a bit of these two notions of, I don’t want to generate harm on them, but I also understand that they are my potential consumers and or regulators. So I also want to take this as an opportunity, not just to manage my performance because I’m a good guy, but also because I want to make money. No, this is okay for businesses to want to make money. They should not. And then once I’ve done all this mapping, I want to identify actual and potential impacts, risks and opportunities, right? And here, this will be informed, of course, by this so-called stakeholder engagement, which does not mean sending massive surveys and questionnaires to thousands of people. No, no. It means trying to find the right stakeholders that would have pertinent, relevant answers to help you. For example, if you’re going to check into those disclosures that are under the own workforce standard, you want to understand what are the sustainability matters that are material for you as a company? Is work life balance important? Is non discrimination important? Fair wages? Well, begin by talking to your most relevant stakeholders in this sense, which will be your own employees and their trade union representative. If you want to talk about, you know, if you’re concerned about possible impacts on biodiversity, then don’t ask your customers or suppliers about it. Try to seek civil society organization or find available, publicly available scientific articles, academic articles. It’s 2024. There’s a lot of data out there. So I would say for environmental matters in general, don’t engage excessively with your stakeholders unless they’re a civil society organization that has a lot of expertise, but try to rely as much as possible on objective data, right? For your affected communities, for example. Then you might refer to your due diligence mechanism, if you have one. If you have a complaint mechanism or whistle blowing channel, then this will help you inform what could be material for your company. Once you have, let’s say, you have a very exhaustive list of all possible impacts, risks and opportunities, then you start assessing them, right? Because you will not be able to tackle every single one of them from that first exercise, you need to be able to prioritize a little bit and you will assess which are the material impacts, risks and opportunities. And this is where maybe I would understand. It gets a little bit more complicated because neither the CSRD or the ESRS give you any threshold to tell you what is considered material or not. Right. So you’re going to have to exercise your judgments. You have three criteria. You have one criteria, which is severity for actual impacts and likelihood for potential impacts. Right. Severity, escape scale, scope, and irremediable character. So that this is what you will consider when you think about, okay, well, here I do have an actual impact of an incident of child labor in my tier one supplier. So I think, okay, in terms of scale, well, this is a pretty grave impact. Now, in terms of scope, you think, well, it’s one incident, irremediable character, you say, okay, well, maybe you can stop engaging with that supplier. Right. So it is remediable. So you have to basically exercise a lot of judgments and a lot of intellectual integrity as well, and not try to push under the rug what you don’t want to be disclosing. And then the fun part starts when you actually have the list of your material risks and opportunities. Impacts and opportunities are when you will start collecting the data. Right. And here I do encourage companies to first make sure that everybody, so all the departments that will get asked for data, like human resources, procurement, environmental department, all of these folks, suddenly they will receive data from the project manager of the sustainability report, and it will go immediately at the bottom of their priority list. They’ll be saying, why are they asking me for so much data? So I think it’s important to onboard a little bit the whole, you know, all the people that will be concerning the company, make them sure that they understand what this is about, why this is important, so it doesn’t become a very, you know, so that the portrait sustainability reporting champion doesn’t become antagonized. And then I will also strongly advocate that larger companies resort to softwares for data collection. Don’t try to compile everything on excel. So there are solutions out there, like APLANET that will help you a little bit, well, streamline all this data collection. And once you have done that, can. |
Andrés | I stop you just for a second? I think right before what you said, from understanding what’s material for your company and collecting data, there’s like this gap because, and this is for like, the things we hear, people having these big questions. And I want to take advantage right now that you’re here to ask you. They won’t get, like the ESRS in the first chapter. They won’t get that as a material topic. They would get, for example, water consumption or whatever else, you know, so there’s, like this step that they need to do to align the material topics against the ESRS or against GRI. How are you working on trying to, to help these companies to do this in an easier way? Because at the end of the day, they understand what’s material and what’s important, what their IROs are. But then they have to report under that standard that maybe they have the same KPI three or five times. Do you follow me here? |
Carlota | I think so. So if, for example, water is material for my company, then I go to the water standard, right. I look at the different sustainability matters. Well, yeah. Or topics and subtopics. Right. And disclosure requirements. And the structure that it follows is always starting with, you have a policy, do you have actions, you have metrics and you have targets. If you don’t have any of those, then your reporting exercise is actually very easy to just say you don’t have it. Right. And you may say when you expect to have it or what you are doing it to, getting ready to actually either have a water coefficient or policy and measures taken implemented. And indeed the water consumption, I agree with you, it’s a bit easier. Right. Because you can find it maybe on your utility bill, although that’s water usage. So I’m trying to understand, is the question related to the fact that maybe you will have that data but not in the formats that the ESRS is asking for it? |
Andrés | Yeah, because there’s always this problem of taxonomy. You know, people understand what they need to report or at least what’s material for them, but then they need to report on their particular way of doing this. And sometimes companies say, okay, but I need to report the same information several times. Because if I do a GRI report in an ESRS, or if I, for example, a company which is listed in the US or in Europe, they would need to do something for the Dow Jones sustainability index and for the ESRS. So companies usually have a lot of burden in their operations, especially because they have to do multiple, they have to report multiple times in different standards. So one of them, and this is like me listening to a lot of people, they are like, there’s so much to do and it’s so hard to keep on with this that it would be nice to see how their lives could be easier. |
Carlota | Gotcha. Gotcha. Super clear. Yeah. So, yeah, my previous answer was not responding to that. So a lot of things to unpack here. But indeed, there are companies, very large corporations that will have to report, according to the ESRS and the EU and according to the ISSB, in other jurisdictions, which have ISSB embedded in their legislation. Right. And if we go to Chile, there will be GRI. So pause here for a second. What EFRAG, GRI and ISSB, TNFD, etcetera are doing is that we are working very closely together to look at what we call interoperability. And we understand that it will not necessarily be perfect. And that is okay. Each standard has its own identity. So, for example, the ISSB is single financial materiality and some concepts. I mean, if you look at ISSB standard IFRS two on climate, it’s still very similar to ESRS B1 on climate. Having said that, what we are building now within EFRAG is basically some guidance on what it is that preparers. So the companies that are reporting should look, be mindful of starting from both perspectives, if they have the ISSB report or if they have their ESRS report. And for GRI, we’re replicating that effort as well. GRI is more of an impact maturity standard. So we’re trying to each keep our own identity. But also, we are not monsters and we’re not trying to make the lives of companies miserable. Okay. So, and then when it comes to, let’s say, you, I think you mentioned, I don’t know if you mentioned Ecovadis, Sustainalytics. Well, what I see with ratings is that they themselves, they try to make the lives of companies a bit easier. Easier. And they will accept that you attach, for example, that you refer to your audited sustainability report. Right? So if there is something that you’re being asked on your rate by your rating provider, often you can say, actually, you will find your information on page 47 of my sustainability report, which has been audited by an insurance provider. So I think maybe I’m wrong, but I hear a lot about this. There are so many standards and everything is so different. And we’re duplicating data collection. Why are you duplicating data collection processes? It’s essentially more or less the same data. And the ISSB structure is almost exactly the same as the ESRS. So I think, again, it’s about demystifying the complexity a little. |
Andrés | Yeah, well, I agree with you, but, but this is what you hear all the time, you know, people. And I think it’s because usually people, first they comment and then they read. But this is a common thing among a lot of the people we have discussions with. And it was really good that someone who comes from the policymaker or the place where actually things are happening, that they can explain what they, what they view and what they think about it. Okay. |
Carlota | I will say for the Taxonomy, my heart bleeds for the companies, that one is a special animal that has unfortunately no link to the ESRS. Because Taxonomy is about activities. It requires a lot of very granular information desegregating all the economic activities, looking at OPEX, CAPEX. So that is a monster. But I am not responsible for that. I’m already only responsible for the ESRS, which is a bit of an ugly baby, but you know, it’s my baby. I cannot. |
Andrés | It’s your baby. Yeah. Well, once companies does their double materiality, they align their material topics with the, and they start collecting data. What else do they need to do? |
Carlota | Well, honestly, if you’re asking my opinion, you know, the first, yes, of course. They report on that, on the data. They structure it according to ESRS, like you said, have policies, action metrics, targets. But I think what would become meaningful and exciting is actually to formulate an action plan for improvements. Right. And try to think, okay, I did not just waste a tremendous amount of resources and energy on just making a nice report, but also I’m going to leverage this into really well finding out where I have most margin for improvement and how it could also benefit my bottom line. Because usually considering how expensive the electricity is, if you manage to reduce your energy use, it’s going to be good for your wallet as well. The case of a lot of impact, that they have a risk component to it or vice versa. So I would strongly encourage after, once you’ve identified your material impact risks and opportunities, you have collected the data you have structured that are information according to the SRS and this cross cutting structure, then, you know, just finish the job and start working on your, like improving your performance. |
Andrés | Okay, that, that, yeah, that makes a lot of sense actually. But after that, and to comply with CSRD, you need to create a report and that report needs to be XBRL tagged. So what do you think about it? Or how can companies tackle that? |
Carlota | Yeah, so that’s, I think, not going to be my battle. I am very confused by XBRL Taxonomy. I can definitely see the benefits for the users of the report, so the people, especially the financial institutions that want to aggregate the data. But I think I’m not your girl to answer this question. |
Andrés | Yeah, okay, that’s totally fair. We’ve been, we’ve been talking to some companies that help the SEC in the US to report other companies under XBRL, you know, all stuff. And yeah, they have a huge headache trying to incorporate the XBRL taxonomy into their XBRL softwares, you know, so I just needed to take the shot and ask you, because this is something that a lot of people are asking. But, yeah, I totally understand, and I can assume that nobody has enough bandwidth to understand everything and to be working on everything proactively. So, yeah, let’s continue. Well, I think CSRD is something that will be tackled, and it’s a monster for almost 50,000 companies in Europe within the next few years. But you also work for B Lab, and that’s like the nonprofit organization behind the B Corp certification. Can you tell us a bit what B Corp is? |
Carlota | Yeah, I’d love to. So B Corp certified companies are those companies that have demonstrated a very high level of environmental and social performance when verified against B Lab’s standard, right? So, yeah, yet another standard. It’s a different requirement, different sustainability matters. Not all different, of course. I think there are some sustainability matters that, let’s say, appear in all different methodological frameworks and sustainability standards. So we have, you know, a very comprehensive impact assessment where companies have to first self evaluate and then they have to pass through a verification process. And at the end of the day, if they pass, they can get their B Corp certification if and under two additional conditions. They need to change their bylaws. So their articles as association to basically embed that they will balance the benefits of the stakeholders against those for the shareholders. So they have to have a clearly defined mission. And this is to make sure that basically, if the company then gets acquired by another company or the ownership changes, that still the company will not stop doing this. Positive impact. Right. So this is what we know about. This is what we know as stakeholder governance. And. And also, B Lab has advocated in more than 40 states in the United States and ten countries in the world, including, including Spain, for the adoption of a legislation for benefit corporations. Okay? So now we even have our specific legal form in some countries. And then these companies also have to pass a risk review for controversial practices, adverse impact on their value chains, etcetera. So essentially, these are best in class companies. It’s a very different certification than maybe a fair trade or lead or ISO, because we’re really considering, you know, the whole holistic approach to the company. We’re looking at governance, we’re looking at community workers, customers, environment in the whole value chain, upstream, downstream. And this is, of course, very complementary to. To disclose obligations because, I mean, it’s great to ask that companies be transparent and facilitate all information in a nice sustainability report. But me, as a user, I read a report and I said, hmm, great. This company has this water consumption or this carbon intensity. What does that mean? I don’t know if that’s a good performance or bad performance, because I’m not an expert. You know, I don’t have benchmarks just like that. So this is why, like B Corp, I think could be a nice addition, is that you’re using a lot of the information that you have collected for your sustainability report. You can use it again for your B Corp certification. But the verifiers, the analysts of B Corp, will carry a judgment on the metrics, on the data points. You know, they will say, this is good performance and then you can get certified. Or is this just like, you know, normal or below market practices? Right. So this is what we mean by performance standard is that the ESRS, GRI, ISSB, they don’t prescribe behavior. They don’t tell you what to do. They just say, you can be a horrible bastard, but you have to be transparent about it. We prescribe behavior. We’re saying if you don’t do this, if you don’t do that, then you cannot get the B Corp certified. |
Andrés | That’s great. And you just said something that is also another question that companies have, and they ask us a lot, and we have like this discussion currently, how do they, because this is under CSRD and it’s also in B Corp, as you said. What’s a good way to, or how can they manage their supply chain? Because it’s super hard to accurately assess their impacts, to manage them, to collect this, and to have a whole understanding of how your supply chain is behaving and if that affects you or it’s going to have an adverse impact in the near future for your company. What would you say about it? |
Carlota | I would say the consolidated practice that has emerged and matured is due diligence. I know that in Spain we don’t yet have it, but now we have a european directive that has been adopted by council a few days ago, and that will be probably, I hope, adopted by parliament in April, which will require that companies have a due diligence process in place. Right. And this due diligence is referred to all along in the ESRS: Right. And this is basically setting up the right processes, procedures and mechanisms to identify adverse impacts in your value chain. Right. So there, again, you will have to prioritize. You will have to use the best available data that you can get. You can again, use a bit of common sense because again, it’s 2024. You know that if you are in the automobile manufacturing or phone manufacturing. You know that the batteries that you’re using rely on the extraction of rare metals, which is done in very, you know, not human rights friendly conditions. Right. In some countries in Africa. So maybe you should start by prioritizing this. We’re talking. Remember I mentioned earlier that the criteria you should use is severity? Well, it’s the same concept as due diligence. So you think you know what, me, the phone manufacturer. I think. I know that my most severe impact is in the mines where these metals is being extracted. We know, we’ve known only for a few years now, but we know that in East China there are forced labor camps, not the Uyghur camps. So if you’re in a textile industry and your suppliers are in East China, or your supplier suppliers are in East China, then, yeah, you should know that you have to be diligent. You have to maybe go on site or speak with civil society organizations that are there, but do what you can do to first see what’s going on, and then second, try to mitigate the damage. So for the value chain information, there is going to be a lot of reliance on due diligence and a lot of engagement with your tier one suppliers to start. That’s a good starting point just to ask your suppliers. But I know it’s a pain. I know that for very large companies, even though they have a lot of suppliers, they have a lot of traction. They themselves are an important client for their supplier. So that can be okay. But if you’re a small or medium sized company, maybe you don’t have that leverage and maybe it will be difficult to instigate. So the good thing. Good thing is that, you know, companies down to 250 employees will have to provide their sustainability reports. So it’s only those below the 250 employees where you won’t have the data accessible. And here I’m just going to rely on the assumption that because they are smaller, you will have sufficient leverage to get this information from them, hopefully. |
Andrés | It was a shame that the CSDD was like watered down at the end, but, yeah, it is. It is what it is. Now, linking my previous question, how does B Corp relate to the ESRS? Because, I mean, it’s independent, but right now everything is linked in a way. |
Carlota | Yeah, that’s fair. So one of the things I did was to map the data points to understand what is the level of conceptual alignments. In the case of metrics, what is the range of interoperability? And I found a very high level. I think there’s less than 15% of the metrics that are not aligned. But there are some topics that B Corp asks that go beyond the ESRS, and that’s okay because we want to be the best practices in the market. So, for example, in the ESRS, you don’t have a lot about anti discrimination, justice, equity, diversity, and inclusion. B Corp does have a whole subsection of that. We’re also asked about employee well being and health. So there are still a lot of topics. We also look at the virtues of the product themselves. So we also have a space for positive impacts. And if, for example, you’re building infrastructure in a place, you’re building WiFi, you’re a telecom company, you’re building wifi in an underserved community where there was no WiFi, we will give you points for that. Or if you are a software company that helps companies improve their impacts through sustainability reporting like a planet, you will also get points for that. So there is also. We look, whereas the ESRS doesn’t really look at the product themselves. We do. So it’s not an exact match, nor do we want to be an exact match. What we want to avoid is, for example, that if there is a definition for what a worker is in the ESRs and how to calculate the headcount, then B Corp will align and will accept the same calculation methodology for the headcount. You know what I mean? So in this, we wouldn’t want to duplicate the human resources job and things like this. |
Andrés | Exactly what we were discussing before. Yeah. |
Carlota | And then B Corp will basically, for those companies that have. Are very good, performing very well, the benefits. The advantage is that if they get B Corp certified, then they can. This is a strong message to consumers and investors that they have a good performance. It’s related to what I said before, that people don’t necessarily have the time or the know-how to look into sustainability reporting. Well, if you have a high Ecovadis scoring or if you have a B Corp certification, then it’s a proxy to. It’s a signal to say this is a good company. |
Andrés | Yeah, that’s a great way to signal and to prove that you are actually committed to sustainability. That’s amazing. Well, I know that you are all over the place. So you’re with them. Yeah. You are also with B lab and B Corp, but you also work for, or you are a technical expert with GRI. What is the relevance of GRI now? Right now that the ESRS are mandatory and the ISSB is increasingly embedded in the legislation in different jurisdictions. |
Carlota | So I see a twofold purpose for GRI. First, Yeah. ISSB has only climate related disclosure standards, right. GRI has like a million topic and a million sector. How many standards do they even have? Like, so, you know, today in Chile, very large listed companies, they have to report, according to GRI. I don’t think the government of Chile will say, you know what? Strike that. Now we’re only doing climate. That would seem like a very many, many steps back. So I’m touching wood, but I hope that won’t happen. So, I don’t think companies will focus only on climate just because the ISSB is going to be embedded in legislation. I think they will put more resources in climate disclosures, but they won’t stop disclosing on the rest. And I still think GRi will be preferred in Latin America, for example, would be preferred over other standards, like maybe SASB, things like that. And that, for me, a very important role of GRI, and that’s why I joined it, is that they are, first, I love impact materiality. To me, it’s what makes sense from a systemic perspective. To me, it does not make sense to try to really disaggregate, like, go through, like, mental gyms, gymnastics of understanding. But how much is this going to cost me? What do you care? Like, if. If we’re in two degree planets, that it will be insufferable. It will be horrible. So think a bit of the systemic risk, you know, rather than if it’s going to really diminish your return on investment. And the good thing is that if GRI keeps the bar very high, me, when I’m in frag and I’m negotiating for ambitious standard, I said no. But look at what our friends at GRI did, right? So, Gri, now that we are developing sector specific standard, well, guess what, is the mother of all sources, guess at who we’re looking. Right? So they have this. I think there will still be a lot of companies using GRI. You know, I think 75% of the 250 largest companies in the world were reporting to GRI. I don’t think that will go away from one day to another. And second, they have a very important, very important role in influencing standard setters that are then embedding data points into legislation. |
Andrés | Yeah, I think this also seems you are in both organizations. It would be amazing to try to move forward interoperability between those two, because I think if ESRS resemble a little bit more like GRI, they have high standard. They are. They are like the mother. So that would be great. And I think you answered everything that I wanted to know. And I really appreciate your sharing all of this knowledge and how, well, how thoughtful you are and all of the process that you’re putting behind this. Also, I think, like, young people who are working in this, they’re really going to make a change. So thank you very much for this time and thank you for sharing your knowledge with us. Lastly, there’s something that I always ask people who come here, and that’s obviously to expand the knowledge. Who else would you like to see interviewed here at APLANET? |
Carlota | First, thank you for calling me young. I really. You’ve made my day. That’s awesome. And thank you for your work, because it’s true that in EFRAG, we’ve created complex standards, and we’re sorry about that. It was the result of a lot of compromise between different stakeholders. And we’re very grateful that there are companies like yours, like, helping, you know, the preparers get their things in order. And I think I am a bit tired of all these conversations only around ESG. And I want to talk about positive impact. And one person that comes to mind is called Arancia Martinez. To me, she’s a dear friend and a queen of positive impact, because sustainability should not be only about disclosures and compliance. It should also be about mission alignments and purpose. So I would recommend you talk to her. |
Andrés | Well, if you’re hearing this, please, Arancia, I want to talk to you. Otherwise, Carlota, I will ask you to get me an intro. On the other hand, there’s something that we say all the time is that at a planet’s mission, we want to take companies from compliance to sustainability. And that’s our motto, because we know that unless there’s, like, this sustainability embedded in the company’s DNA, it’s really hard to go and do, like, this conscientization about sustainability as a whole. So I think compliance is like the integrate, and this is like the troyan horse, and then we’re gonna do the mission once we’re inside the companies. But, yeah, that’s a great idea. I hope I can talk to her. And thank you very much for your time. I really appreciate your kindness. Thank you. It was a pleasure talking to you. |
Carlota | Thank you. Pleasure talking to you. |
Andrés | For all of you, for seeing. I hope you enjoyed this conversation and see you in the next one. Bye. |