Accountability: An obligation to account for one’s responsibilities, often accomplished through some form of reporting process to answer for one’s actions.
Accurate: A description of information or indicators that are free of errors and that fairly represent the activities of an organization.
Achievable: A description of an activity, indicator, or target that can be accomplished. To be achievable, the item should be linked to someone’s responsibilities and thus require action.
Assurance: A provision of confidence or certainty given by an independent assurance provider to certain subject matter.
Assurance engagement: An agreement whereby the organization contracts an assurance provider to express an opinion about the reliability of some aspect of an organization’s activities; also called assurance service.
Assurance statement: A short report providing an opinion about the credibility of the subject matter, often information in a sustainability report regarding an organization’s activities.
Balance: Reporting both accomplishments and challenges; providing information on both positive and negative activities.
Benchmark: A point of reference or standard used to place performance in context.
Board of directors: The governing body of a corporation or organization, elected by its shareholders (owners) or membership, to provide direction to the managers who should act in the best interest of its owners, members, or donors.
Brundtland Report: An outcome of the WCED that defined sustainable development with an economic, environmental, and social component. Its main message is that nations need to work together for “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.’’ Also known as Our Common Future.
Capitalism: An economic system in which most of the means of production are owned by private enterprises, rather than by the government, with the purpose of making profits.
CDP: Formerly the Carbon Disclosure Project, the CDP manages a disclosure system on carbon, forestry, and water. Most respondents are corporations, but some government bodies and other organizations also respond to its annual questionnaires.
CERES: The Coalition for Environmentally Responsible Economies is a group of environmental, investor, and advocacy organizations coordinating efforts to promote sustainable practices. CERES brought forth the Valdez Principles and was instrumental in initiating the Global Reporting Institute (GRI).
CDSB: The Climate Disclosure Standards Board’s objective is to provide a framework for reporting natural capital that is as rigorous as financial capital reporting.
Certain subject matter: The processes and procedures incorporated in an information system or an environmental or social management system, which is the subject of an assurance. Examples are the accuracy of certain indicators, the accuracy of accounting for greenhouse gas (GHG) emissions, or the adherence to a certain standard.
Comparable: The ability to judge an organization’s performance against others. Benchmarks are beneficial for comparability purposes.
Complete: A description of information that includes all material activities, provides balance, and compares performance to other organizations, year-to-year, or to a standard.
Conflict minerals: Natural resources mined in an area of human conflict, with the revenues used to support the conflict.
Control system: All of the integrated processes and procedures that an organization has implemented to achieve an objective. A control system is part of a management system that includes both planning and control.
Corporate Reporting Dialogue: An initiative convened by the IIRC that attempts to harmonize reporting frameworks, standards, and requirements for both financial and sustainability reporting, consisting of the CDP, CDSB, GRI ISO, SASB, IFRS. FASB is an observer.
Cost effective: A description of an activity that can be achieved with the least cost, thus combining effectiveness and efficiency.
CSR: Corporate social responsibility or reporting, frequently used instead of sustainability. CSR defines how corporations should act but is less clearly defined than sustainability.
Decision making: Logical thought processes that stakeholders, as well as stockholders, use to gather information to take action in the future.
Eco-efficiency: Activities or indicators that integrate both economic and environmental objectives. Indicators of eco-efficiency have one dimension related to the environment and the other related to the economy (one is the numerator and the other the denominator).
Economic: A dimension of sustainability that represents the production, manufacture, and distribution (along with other activities) of economic goods and services.
Effectiveness indicator: A metric which determines if an objective is met, regardless of cost, such as ratings for employee satisfaction.
Efficiency indicator: A metric which measures output related to input. Products or services produced (output) are divided by resources used to produce them (input), such as emissions per barrel of oil produced.
Environment: A dimension of sustainability that represents a system of maintaining integrity of the ecosystems to enable them to continue to produce and function for future generations.
Environmental reporting: A means of providing information about an organization’s environmental performance, similar to sustainability reporting; however, the focus is only on one of the three dimensions of sustainability: the environmental dimension.
ESG: A term used to refer to environmental, social, and governance performance. Governance is partially substituted for the economic dimension of sustainability.
External assurance: A statement by an independent third party about the accuracy of information and/or adequacy of performance. It involves the engagement of a qualified person outside of the organization to comment on, and provide opinions about, performance or reporting.
GHG emissions: Greenhouse gases, such as carbon dioxide and methane, that appear to be causing climate change.
Greenwashing: Performance or reporting that appears environmentally responsible on the surface but further investigation suggests that it is actually superficial, not showing depth.
GRI: The Global Reporting Initiative, an international organization that has prepared guidelines, and most recently standards, with the support of a multidisciplinary group of stakeholders. Organizations use the standards to prepare their sustainability reports.
GRI Sector Disclosures: A supplemental guideline or standard, which is customized by the Global Reporting Initiative for a certain industry.
Guideline: A source of reference for principles or rules on a certain topic.
IIRC: International Integrated Reporting Council, an organization which comprises regulators, investors, companies, standard setters, the accounting profession, and non-government organizations (NGOs) that work to establish integrated reporting as the mainstream format for sustainability reporting.
ISO: International Organization for Standardization, an organization that brings together standard setting organizations in 160 countries to develop and publish international standards that meet the needs both of business and broader society.
Independent assurance provider: A firm or person who is not biased in his/her opinion regarding information provided by the organization and has no interest in seeing information presented either favorably or unfavorably.
Indicator: A means of quantification using a metric. Even though performance can be presented in qualitative, narrative form, organizations and stakeholders usually prefer quantitative indicators to easily and quickly assess trends, challenges, and accomplishments.
Input: An activity or indicator which measures what is going into a process, such as dollars invested into a community, but it does not determine what result occurred with those dollars.
Integrated Report or Reporting: A principles-based framework, promoted by the IIRC, that focuses on how a company creates value over a short-, medium-, and long-term period through the maintenance of six capitals.
Internal assurance: Internal controls and internal audits are two forms of internal assurance that are carried out by employees of the reporting organization to monitor operating results, verify records, and assist with increasing efficiency and effectiveness of operations.
Internal audit: Frequent reviews to evaluate internal controls, monitor operating results, and verify records to increase the efficiency and effectiveness of operations and to detect fraud.
Internal audit department (function): A unit within an organization that consists of internal auditors who perform ongoing audits or reviews at a more detailed level than that of an external assurance provider.
Internal auditor: An employee who provides unbiased consultation on internal controls through audit and assurance services. Internal auditors should report to the highest level of management and the board of directors to ensure independence.
Internal controls: Procedures and practices that direct, motivate, or deter certain types of behavior to help meet an organization’s objectives.
Lagging Indicators: Detective measures or metrics used after an activity occurs.
Leading Indicators: Preventive measures or metrics used before an activity occurs.
Legitimate: A description given to an organization that is producing a good or service in a manner that stakeholders and society wish. Related to legitimacy theory.
Limited assurance: The result of a review or audit having a narrower scope and less depth than reasonable assurance or a full audit, usually confined to certain accounts or operations; sometimes called negative assurance.
MD&A: The Management Discussion and Analysis section of a company’s annual report in which management explains numerous aspects of the company’s financial performance, both past and present, occasionally the future.
MDGs: The eight Millennium Development Goals of the United Nations Member States which are the predecessors to the SDGs. They were the first formal call to action with specific targets for all entities to operate more sustainably with an achievement date of 2015.
Material: Information that is important to a decision.
Materiality matrix: A means of classifying sustainability topics to the extent of their “importance to stakeholders” and “impact on the organization,” often found in the sustainability report. The Global Reporting Institute (GRI) requests this approach to linking stakeholders’ needs and desires to a company’s sustainability activities and reporting.
Measurable: An activity or indicator which can be put in the form of numbers or metrics.
Multi-stakeholder process: A course of action that includes opinions and expertise from a variety of organizations, groups, or individuals that have an interest in, or are affected by, the result.
Nested circles: A means of illustrating the concept of sustainability in which the economic dimension is nested within the social dimension, which in turn is nested within the environmental dimension.
Objective: An aim, goal, or intention. Objectives are the most basic planning tools underlying all strategic activities.
Outcome: An activity or indicator which measures the result of the input or output (such as health effects or satisfaction from eating the meals).
Output: An activity or indicator which measures what is coming out of a process (such as number of food bank meals provided).
PERI: The Public Environmental Reporting Initiative, one of the first guidelines to help organizations communicate environmental performance information to its stakeholders.
Performance: An action that helps to accomplish an objective or goal. It is usually measured in the form of metrics/indicators such as pre-determined standards of completeness, cost, or speed.
Performance measurement system: A complete set of indictors consisting of metrics used to quantify how well an organization fulfilled its responsibilities as identified in its policy.
Primary stakeholder: A person, group or organization that transacts with a company, such as customers, employees, suppliers, shareholders, and financial institutions. Also, stakeholders that are included in a company’s product life cycle or value added chain.
Reasonable assurance: A review or audit having a broader scope and more depth than undertaken for limited assurance; also called positive assurance. However, no audit or review can provide absolute certainty that an event will (or will not) occur or that data are absolutely accurate.
Regulator: Part of a system which determines and maintains the operating parameters usually within specified limits or scopes. A regulator may be an electronic or mechanical device or a person which ensures certain actions are (or are not) undertaken.
Relevant: Information, topics, or indicators that are significant, important, and useful for making decisions. They also reflect the core values and strategy of the company and the expectations of the stakeholders.
Reporting organization: A business organization, non-profit organization, government, or non-government organization that provides information in a report form on some aspect of its environmental, social, and economic performance. The report provided is generally referred to as a sustainability or a corporate social responsibility (CSR) report.
Risk strategy: Plans, policies, procedures, and controls used to minimize the probability of a negative event occurring.
SASB: The Sustainability Accounting Standards Board, an organization established to develop standards for reporting of material sustainability topics (in securities commissions’ filings) for publicly-held companies. Material topics differ among industries.
SDGs: The 17 Sustainable Development Goals were adopted by the United Nations Member States to call all entities to operate in a more sustainable manner with a targeted achievement date of 2030.
SMART: An acronym used for the following characteristics of indicators or targets: Specific, Measurable, Achievable, Relevant, and Timely.
Secondary stakeholder: A person, group or organization that is affected by, or can affect, the transactions and activities of a company, such as community groups, non-government organizations, governments, human rights advocates, and environmental advocates.
Shareholder: Any person, company or other institution that owns at least one share of stock in a company. Shareholders are the owners of a company. They have the potential to profit or lose depending on the company’s financial operations; also referred to as stockholders.
Specific: A description for an indicator that is valid and credible. It is clean and simple, easy to interpret, comparable with others, and understandable.
Spin: Presentation of a situation or information in a biased or slanted manner, not balanced or complete.
Social: One of the dimensions of sustainability represents a system of living in groups or communities rather than in isolation.
Social license: A theoretical concept suggesting that an organization (primarily a business) can operate if it provides value in the form that society desires.
Stakeholder engagement: Contact with an organization’s stakeholders to exchange ideas.
Sustainability: The ability to maintain a state in which the economy, environmental resources, and social needs and wants are harmonized to ensure resilience of the planet and a high quality of life for future generations.
Sustainable capitalism: A form of economic system in which the primary means of production are held by private enterprises but considers the carrying capacity of the planet and the needs and expectations of all stakeholders.
TFCD: Task Force on Climate-related Financial Disclosures, an organization established to develop the necessary risk disclosures related to the climate.
Timely: A description for an indicator that is collected when data are needed to warn if corrective action is necessary and is available to stakeholders when needed for their decision making.
Transparent: An action, method, procedure or information which lacks hidden agendas and conditions.
Unbiased party: An individual without an interest in the organization and therefore would have no motive for an assessment to be positive or negative.
Venn diagram: A means of illustrating the concept of sustainability in which circles representing the three concepts of sustainability (economic, social, and environment) partially overlap each other.
WCED: World Commission on Environment and Development, created to address growing concern about the accelerating deterioration of the human condition and natural resources and the consequences of that deterioration for economic and social development. The WCED published the Brundtland Report in 1987. Also called our Common Future, which brought forth the concept of sustainable development.