The Impact Disclosure Taskforce, led by financial firms including JPMorgan and Natixis, have unveiled their voluntary Impact Disclosure Guidance.
According to ESG Today, this crucial framework is designed to assist both businesses and governments in quantifying and reporting their efforts toward achieving the United Nations Sustainable Development Goals (SDGs). The unveiling marks a significant stride in mobilizing the necessary capital, estimated at $4 trillion annually, to bridge significant development gaps particularly in under-resourced areas.
The taskforce, established in 2023 and composed of over 80 financial entities and stakeholders, addresses the critical shortfall in disclosure that impedes the flow of sustainable capital required for the SDGs. These global goals encompass a broad spectrum of objectives set in 2015 under the 2030 Agenda for Sustainable Development, aimed at fostering a sustainable future through objectives such as eradicating poverty, enhancing education, and safeguarding the environment.
Gergana Thiel, Global Co-Head of Macro Sales at J.P. Morgan, highlighted the diversity and depth of investor interest in impact initiatives. “Institutional investors that prioritize impact in their investment strategies are more varied and nuanced than traditional ESG investors. While some investors may seek impact on financial inclusion, others on water and sanitation, and others on gender equality; they all require better impact disclosure from entities issuing securities. This guidance will increase the investment opportunities across all themes, providing investors more choice to invest in accordance with their financial and non-financial criteria.”
The guidance introduces a five-step process tailored for corporate and sovereign entities, facilitating the measurement and disclosure of the development impact of their business strategies and national development plans. This approach is entity-level yet context-specific, focusing on the strategic orientation of entities in their respective focal countries and assessing the anticipated impacts of their products, services, and operations on addressing critical development challenges.
The Impact Disclosure Taskforce remains committed to supporting the implementation of these guidelines and is working on enhancing market infrastructure to facilitate the dissemination and analysis of disclosed impact data, marking a new phase of proactive engagement in sustainable finance.
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