Relevant Issues (5 of 26)
Why are some issues greyed out?The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.
- GHG Emissions
- Air Quality
Energy ManagementThe category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
- Water & Wastewater Management
- Waste & Hazardous Materials Management
- Ecological Impacts
- Human Rights & Community Relations
Customer PrivacyThe category addresses management of risks related to the use of personally identifiable information (PII) and other customer or user data for secondary purposes including but not limited to marketing through affiliates and non-affiliates. The scope of the category includes social issues that may arise from a company’s approach to collecting data, obtaining consent (e.g., opt-in policies), managing user and customer expectations regarding how their data is used, and managing evolving regulation. It excludes social issues arising from cybersecurity risks, which are covered in a separate category.
Data SecurityThe category addresses management of risks related to collection, retention, and use of sensitive, confidential, and/or proprietary customer or user data. It includes social issues that may arise from incidents such as data breaches in which personally identifiable information (PII) and other user or customer data may be exposed. It addresses a company’s strategy, policies, and practices related to IT infrastructure, staff training, record keeping, cooperation with law enforcement, and other mechanisms used to ensure security of customer or user data.
- Access & Affordability
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
- Labor Practices
- Employee Health & Safety
Employee Engagement, Diversity & InclusionThe category addresses a company’s ability to ensure that its culture and hiring and promotion practices embrace the building of a diverse and inclusive workforce that reflects the makeup of local talent pools and its customer base. It addresses the issues of discriminatory practices on the bases of race, gender, ethnicity, religion, sexual orientation, and other factors.
Business Model and Innovation
Product Design & Lifecycle ManagementThe category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
- Business Model Resilience
- Supply Chain Management
- Materials Sourcing & Efficiency
- Physical Impacts of Climate Change
Leadership and Governance
- Business Ethics
- Competitive Behavior
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management
- Systemic Risk Management
Disclosure Topics (Industry specific) for: E-Commerce
Hardware Infrastructure Energy & Water Management
The E-Commerce industry uses a large part of the energy it consumes to power critical hardware and IT infrastructure in data centres. Data centres must be powered continuously, and disruptions to the energy supply can have a material impact on operations, depending on the disruption magnitude and timing. Entities also face a trade-off between energy and water consumption for their data centre cooling needs. Cooling data centres with water instead of chillers improves energy efficiency, but this method can result in dependence on potentially scarce local water resources. Entities that effectively manage this issue may benefit from cost savings and minimise reputational risks, because concerns over energy and water use are growing.
Data Privacy & Advertising Standards
E-commerce entities have access to consumer information, including financial information, purchase history, and basic demographic data. Entities in this industry must carefully manage two separate and often conflicting priorities. On one hand, entities compete on their ability to leverage data to provide users with relevant services and target advertising or product recommendations based on consumers’ preferences and behaviour patterns. On the other hand, the fact that entities have access to a wide range of user data, such as personal, demographic, and behavioural data, raises privacy concerns among users and the public at large, and is leading to increased regulatory scrutiny from authorities in the U.S., Europe, and other jurisdictions. Failure to manage the issue can result in costs associated with regulatory oversight and reputational risks. Furthermore, effective management in this area can have financial implications through increased user confidence and loyalty, which are particularly important to maintain market share.
The business model of entities in the E-Commerce industry depend on a firm’s ability to securely process electronic payments. As consumers become more educated about the threats of cybercrime, particularly in the wake of continued high-profile attacks, having a reputation as a secure entity will become increasingly important to maintain or gain market share. There is an opportunity for the most trusted brands to position themselves favourably in the eyes of consumers and gain a significant competitive advantage. This makes user loyalty, which is highly influenced by the perception of the safety of the user’s valuable financial and personal information, particularly important to maintaining market share.
Employee Recruitment, Inclusion & Performance
Employees are key contributors to value creation in the E-Commerce industry. While the number of job openings in the industry continues to grow, entities are finding it difficult to recruit qualified employees to fill these positions. In key markets, a shortage of technically skilled domestic workers has created intense competition to acquire such employees, contributing to high turnover rates. This competition for talent and the search for innovation opportunities presents several interrelated sustainability challenges regarding human capital that entities must manage. Hiring foreign nationals to compensate for shortages in local talent can create risks related to perceived social implications in the host and home countries of workers. Entities offer significant monetary and nonmonetary benefits to improve employee engagement and, therefore, retention and productivity. Initiatives to improve employee engagement and work-life balance might influence the recruitment and retention of a diverse workforce. As the industry is characterised by relatively low representation from women and minority groups, efforts to recruit from and develop diverse talent pools can serve to address the talent shortage and generally to improve the value of entity offerings. Greater workforce diversity is important for innovation, and it helps entities understand the needs of their diverse and global customer base.
Product Packaging & Distribution
A significant part of the E-Commerce industry’s added value comes from an entity’s ability to move a wide array of goods efficiently to consumers who would otherwise have to personally travel to collect the goods from brick-and-mortar stores. As the volume of packaging shipments increases, the industry may become more exposed to environmental externalities, such as carbon pricing and rising fuel costs that present risks associated with the shipping of products. While entities that outsource shipping and logistics have less control over the specific processes of shipping operations, they still can select suppliers with more energy-efficient business practices. Because this is a highly competitive and low-margin industry, the ability to reduce shipping costs through fuel reduction and more efficient routing may permit entities to pass those savings on to their customers. E-commerce entities also have an incentive to minimise the use of packaging. Efficient packaging can decrease costs by reducing the amount of purchased packaging material, as well as saving logistics costs because more products may fit into a single shipping load.