SUSTAINABILITY REPORTING IN SRI LANKA 2023:

Connecting the dots

Contents
About GRI

1

Foreword

2

Introduction

3

Overview of Sustainability Reporting in Sri Lanka

4

Survey Methodology

8

General Disclosures

9

The Organisation and its reporting practices

10

Activities and workers

11

Governance

12

Policies and practices

15

Stakeholder Engagement

16

Economic

17

Economic Performance18

Market Presence, Indirect Economic Impacts and Procurement Practices

19

Anti-corruption and Anti-competitive Behaviour

21

Tax

22

Environment

23

Materials

24

Energy

25

Water

26

Biodiversity

27

Emissions28

Compliance & Supplier Environmental Assessment

32

SocialLabour Practices & Decent Work

33
34

Employment and Labour Management Relations

36

Occupational Health & Safety

37

Training & Education

38

Diversity & Equal Opportunity

39

Human Rights

40

Local Communities

42

Product Responsibility

43

Way Forward for Sri Lanka

46About GRI
GRI (Global Reporting Initiative) is the independent, international organisation that helps
businesses and other organisations take responsibility for their impacts, by providing themwith the global common language to communicate those impacts.
The GRI Secretariat is headquartered in Amsterdam, the Netherlands, and we have a
network of seven regional offices to ensure we support organisations and stakeholders
worldwide.
As a catalyst for a sustainable world, we work with businesses, investors, policymakers,
civil society, labour organisations and other experts to develop the GRI Standards andpromote their use by organisations around the world.
Used by more than 10,000 organisations in over 100 countries, the Standards are advancing
the practice of sustainability reporting, and enabling organisations and their stakeholders totake action that creates economic, environmental and social benefits for everyone.
As confirmed by 2022 research from KPMG, the GRI Standards remain the most widelyused sustainability reporting standards globally.

Sustainability Reporting In Sri Lanka 2023

1

Foreword

Director, GRI South Asia Network
Dr.Aditi Haldar
GRI South Asia Network celebrates a decade of promoting and supporting sustainability reporting in
the region. During this time, the network has forged strong partnerships across the countries in thisregion as we worked together for a common cause. We have also witnessed first-hand how the GRI
Standards have shaped the sustainability journey of corporates who have challenged themselves toreview established business practices and move to more sustainable business models.
GRI South Asia Network has had a fruitful partnership with the Colombo Stock Exchange to promotesustainability reporting in the country and is renewing this partnership with the third edition ofCommunicating Sustainability to support preparers embarking on their sustainability reporting
journeys. We have supported capacity building in the market with workshops over the year andthrough our presence at conferences of professional accounting bodies throughout the decade of ouroperations.
This survey of sustainability reporting in Sri Lanka is timely as it allows us to objectively review
progress in this country. It is encouraging to see the role played by GRI Standards in the market as themost widely used standard in sustainability reports in Sri Lanka. The multistakeholder approach of
the GRI standards is also relevant given the current socioeconomic challenges of the country and its
transition to a low carbon economy. The survey has also drawn attention to the sustainability context
of the topics where relevant credible information was available.
I take this opportunity to commend the work of the companies that have embarked on their sustainability
reporting journeys. I also encourage others to seize the opportunities to strengthen the resilience of
their businesses through adoption of holistic reporting standards.

Director, GRI South Asia Network
Dr.Aditi Haldar

2

Sustainability Reporting In Sri Lanka 2023

Introduction

Sustainability reporting continues to gather momentum in Sri Lanka with corporates voluntarily
adopting sustainability reporting standards. Foreign investors and pressure from large customers
located in advanced economies provided the necessary impetus for action for some while others
adopted it solely as a sound business practice. Additionally, sustainability reporting award competitionsorganised by professional accounting bodies have also played a critical role in the voluntary
adoption of sustainability reporting by corporates. Certifications required by customers supported
development of policy frameworks and monitoring systems for environment and social reporting. As
a result, many corporates have journeyed beyond compliance to integrate sustainability principles
into their operations. Some corporates have also successfully demonstrated the benefits of integrating
sustainability to create a competitive advantage through sustainable investment and innovation to
improve performance and business resilience within their industry sectors.
GRI Standards have played a key role in the evolution of sustainability reporting providing a
blueprint for corporates to commence their sustainability journey. Often used as the primary standard
for implementing a holistic sustainability reporting system, the comprehensive topic coverage
accompanied by clear definitions for metrics proved invaluable to formulate policies and set up
systems and processes for monitoring progress. Many corporates use the GRI topics as the core for along list to determine materiality as well where sector guidance is not available.
The survey focuses primarily on sustainability reporting in accordance with the GRI Standards bycompanies listed on the Colombo Stock Exchange for the financial years ending 31st December 2022
and 31st March 2023. It is based on a survey of annual reports submitted to the Colombo Stock
Exchange as at 30th September 2023. The results of the survey were reviewed thereafter to identify
areas for improvement. The survey also serves as a reference point for measuring progress in this vitalarea, supporting the development of capital markets in the country.
The subtitle of this report highlights the need to consider the sustainability context of the material topics.
The report includes relevant information relating to the country to assist corporates in determining
material topics.

Sustainability Reporting In Sri Lanka 2023

3

Overview of Sustainability Reportingin Sri Lanka
Chambers of commerce and professional accounting bodies championing sustainability reporting
through awards programmes that recognise best in class performance have been key to growth in thenumber of sustainability reports in the country. These institutions also created awareness on the subject
through seminars and workshops providing the know-how required to produce reports that have kept
pace with the evolution in the sustainability reporting landscape.
It is heartening to note that members of the global accounting firms have also enhanced their services
to provide assurance on GRI or other reporting frameworks which is a notable improvement from 2015,
supporting the credibility of sustainability reports.
Regulators have also encouraged sustainability reporting in Sri Lanka and the following actions arenoteworthy:
1. The Colombo Stock Exchange amended its listing rules to require all listed companies to have an
ESG policy on their website in 2023 – Corporate Governance 9.2.11
2. The Central Bank of Sri Lanka encourages licensed banks to disclose environment and social impact
generated from business activities using internationally recognised frameworks such as the Global
Reporting Initiative (GRI) and the recommendations of the Taskforce on Climate-related Financial
Disclosures - Direction No.5 of 2022, 8.22
More regulatory requirements are expected to be announced in the near future with the adoption of the
IFRS Sustainability Standards

CHAMPIONS
Professional
Accounting Bodies
Universities
Chambers ofCommerce
Certifying bodies

Regulators
SEC
CSE
CBSL

Reporting Entities
Listed entities

Unlisted entities

Consultants &Accounting Firms

CSE Listing Rules, Section 9 Corporate https://cdn.cse.lk/pdf/Listing-Rules-Section-9-CorporateGovernance.pdf

1

2

4

Banking_Act_Directions_No_5_of_2022.pdf (cbsl.gov.lk)
Sustainability Reporting In Sri Lanka 2023

It is noteworthy that private companies have also commenced preparation of sustainability reports
using the GRI standards, mainly due to the increased opportunities perceived in demonstrating thesustainability of their operations using a widely accepted standard. However, these reports are not partof the survey due to perceived challenges in obtaining the reports.
Sri Lankan corporates have been reporting on sustainability using the
Guidelines published by the Global Reporting Initiative since 2004.
There are 76 reports that claim to use GRI standards of which only 71
have a GRI Content Index, a pre-requisite for a report to be considered
as a GRI report, under both the “in accordance” option as well as
the “with reference to” option. Consequently, we have used only the
GRI reports with a GRI Content Index for further analysis. Increased
awareness of the GRI Standards would enable corporates to facilitate
preparation of compliant GRI reports.

All GRI Reports musthave a GRI Content
Index

A survey done by SheConsults and Emagewise in 2015 provides a reference point to measure progress.3
The number of reports using the GRI standards has increased during the past 8 years with 10 reports
being added, reflecting a slower rate of adoption which maybe attributable to the difficult conditions
faced by corporates during the pandemic years and the economic crisis in 2022. The total numberof sustainability reports as at 30th September 2023 is 92 with 15 reports using only the Integrated
Reporting Framework.
It is worth noting that an increasing number of organisations are now embracing the Integrated
Reporting Framework and adapting sustainability reporting to this framework. GRI Guidelines remain
as the primary framework for reporting on sustainability and references are made to these guidelines
throughout.

Sustainability Reporting in Sri Lanka: The Big Picture Sustainability-Reporting-in-Sri-Lanka.pdf(she-consults.com)

3

Sustainability Reporting In Sri Lanka 2023

5

ANNUAL REPORTS 2015

ANNUAL REPORTS 2023

%

%
59

77

225

206

GRI Reports
Non GRI Reports

GRI Reports
Non GRI Reports

USE OF SUSTAINABILITY REPORTING
FRAMEWORKS
8

Only SDGs

63

SDG Reports
9

TCFD Reports

15

SASB Reports

15

IR Only reports
9

GRI, IR and SASB Report

54

GRI & IR Reports
5

Only GRI Reports
GRI+ reports

71

Reports with a GRI Content Index

69
76

Reports claiming to use GRI
0

6

10

20

30

40

50

60

70

80

Sustainability Reporting In Sri Lanka 2023

REPORTING & ASSURANCE
There is significant
scope for encouraging
sustainability reporting
across multiple sectors as
the majority of corporates
are not reporting. A sector
based approach would
facilitate prioritization ofhigh impact sectors

Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

10

20

30

40

50

Reports with Assurance: GRIGRI Reports without Assurance
Reports using other frameworks
No sustainability report
The negative number observed in the above chart is due to assurance being provided for a report thatclaimed to be in accordance with GRI Standards but did not have a GRI Content Index.
The following sectors do not have any sustainability reports using the GRI Standards and are omitted
from further analysis in other sections of this report:•

Automobiles and components•

Household and personal products•

Software and services

Sustainability Reporting In Sri Lanka 2023

7

Survey Methodology
This survey was undertaken in order to evaluate
whether listed companies were correctly
identifying and reporting on material aspects
to their organisations as this is critical todriving confidence in corporate reporting anddevelopment of capital markets.
The survey covers the annual reports of allcompanies listed in the Colombo Stock Exchange
uploaded on to the CSE website as at 30th
September 2023. From these, we have reviewed
the annual reports for the financial years ending
31st December 2022 and 31st March 2023 by
excluding companies that had reports relating
previous financial years.
All reports were reviewed to identify whether
they had sustainability reports which werein accordance with GRI Standards, <IR>
Frramework, SASB Standards, TCFD, Sustainable
Development Goals (SDGs) or other framework.
Reports that were identified as GRI reports werereviewed to determine whether a GRI Content
Index was available which is a requirement of
the standards and facilitates further review ofmaterial topics reported to assess the scope of
GRI reporting. Additional sector disclosures were
not considered in order to minimize complexityof the project.
The results were tabulated and aggregated at
sector level to review relevance of material
aspects to each sector.
Our findings arepresented below together with our suggestions
for improvements. Note that only sectors whichhave reported on required disclosures are used
for graphs to maintain clarity.

8

Review financial reports of all listedcompanies to determine timely
preparation of sustainability reports

Reviewed use of widely accepted
Sustainability Reporting standards orframeworks and assurance

Review GRI Reports with GRI Content
Index for Material Topics

Evaluate the material topics reported andtheir relevance to the organisation sectors

Evaluate the quality of reporting ofmaterial topics relating to Environmental
and Social performance

Aggregate by Sector

Sustainability Reporting In Sri Lanka 2023

General Disclosures
The GRI Universal Standards 2 sets out the General Disclosures which are categorized as given below.
Results of the survey have been analysed according to these categories.

General Disclosures

The
Organisationand its
reportingproactice

Activities
and workers

Strategy,
policies andpractices

Governance

Stakeholder
engagement

GOVERNANCE AND STRATEGYREPORTING ON GOVERNANCE
80

71

70

69

69

68

67

67

67

67

65

64

64

66

60
50
40
30

24

20
10

REPORTING ON POLICIESAND PRACTICES

80

65

66

60

63

61

62

62

64

70

10

10

0

0

Sustainability Reporting In Sri Lanka 2023

2-28

20

2-27

30

20

2-26

30

2-25

50
40

2-24

50

2-23

2-21

2-20

2-19

2-18
68

60

40

2-22

2-17

REPORTING ON STAKEHOLDERENGAGEMENT

80
70

2-16

2-15

2-14

2-13

2-12

2-11

2-10

2-9

0

2-29

62

2-30

9

The Organisation and its reporting practices
Reporting on these aspects is satisfactory which is expected due to the basic nature of disclosuresrequired with very few exceptions in 2-4: Restatement of information and 2-5: External assurance.

THE ORGANISATION AND ITS REPORTING PRACTICES
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-5

2-4

2-3

2

4

2-2

6

8

10

12

2-1

The Organisation and its reporting practices
Indicator

Description

Reporting (out of 71 GRI
reports)

2-1

Organisational details

100%

2-2

Entities included in the organisation’s sustainability
reporting

100%

2-3

Reporting period, frequency and contact point

100%

2-4

Restatement of information

97%

2-5

External assurance

94%

10

Sustainability Reporting In Sri Lanka 2023

Activities and workers
Reporting on 2-6: Activities, Value Chain and other business relationships and 2-7: Employees was
satisfactory. However, it was noted that only 57 companies reported on 2-8: Disclosure on workers
who are not employees. This trend was seen across almost all sectors. Considering the numbers ofoutsourced personnel within premises of many establishments (security, janitorial services etc.,) thisis an area for improvement particularly for sectors such as Banking and Diversified Financials which
typically have a number of branches with security deployed islandwide.

ACTIVITIES AND WORKERS
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-8

2-7

2

4

6

8

10

12

2-6

Activities and workers
Indicator

Description

2-6

Activities, value chain and other business relationships

99%

2-7

Employees

96%

2-8

Workers who are not employees

80%

Sustainability Reporting In Sri Lanka 2023

Reporting (out of 71 GRI
reports)11

Governance
Most entities using GRI standards reported on most governance related disclosures, except for the 2-21:
Annual total compensation ratio. Many companies opted not to disclose this citing confidentiality
constraints and correctly indicated this in the GRI Content Index. The GRI Content Index in 24 companies
indicated that this was disclosed and these were followed up to ensure that the requirement was met
given the sensitivity observed. Of these, 23 companies had not disclosed the information required as per
the GRI G2 Universal Standard but had referred to other remuneration related information for employees
or directors. Consequently, only one company had computed the Annual Total Compensation Ratio.

GOVERNANCE - 1
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-14

12

2-13

2-12

2

2-11

4

2-10

6

8

10

12

2-9

Sustainability Reporting In Sri Lanka 2023

GovernanceIndicator

Description

2-9

Governance structure and composition

100%

2-10

Nomination and selection of the highest governance
body

97%

2-11

Chair of the highest governance body

97%

2-12

Role of the highest governance body in overseeing themanagement of impacts

96%

2-13

Delegation of responsibility for managing impacts

94%

2-14

Role of the highest governance body in sustainability
reporting

94%

2-15

Conflicts of interest

94%

2-16

Communication of critical concerns

94%

2-17

Collective knowledge of the highest governance body

92%

2-18

Evaluation of the performance of the highest governance
body

90%

2-19

Remuneration policies

90%

2-20

Process to determine remuneration

93%

2-21

Annual total compensation ratio

34%

Sustainability Reporting In Sri Lanka 2023

Reporting (out of 71 GRI
reports)

13

GOVERNANCE - 2
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-21

14

2-20

2-19

2

2-18

4

6

2-17

8

10

12

2-16

Sustainability Reporting In Sri Lanka 2023

Policies and practices
Reporting on these disclosures were largely satisfactory with over 61 entities reporting on all. Disclosureson 2-25: Processes to remediate negative impacts was the least reported of these. Corporates areencouraged to address these sensitive areas in order strengthen the resilience of the entities.

POLICIES AND PRACTICES
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-28

2-27

2-26

2

2-25

4

6

2-24

8

2-23

10

12

2-22

Strategy, policies and practices
Indicator

Description

2-22

Statement on sustainable development strategy

92%

2-23

Policy commitments

93%

2-24

Embedding policy commitments

89%

2-25

Processes to remediate negative impacts

86%

2-26

Mechanisms for seeking advice and raising concerns

87%

2-27

Compliance with laws and regulations

87%

2-28

Membership associations

90%

Sustainability Reporting In Sri Lanka 2023

Reporting (out of 71 GRI reports)

15

Stakeholder Engagement
These two disclosures were relatively well reported.

STAKEHOLDER ENGAGEMENT
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

2-30

2

4

6

8

10

12

2-29

Stakeholder Engagement
Indicator

Description

2-29

Approach to stakeholder engagement

96%

2-30

Collective bargaining agreements

87%

16

Reporting (out of 71 GRI
reports)

Sustainability Reporting In Sri Lanka 2023

Economic

The GRI Standards have 17 disclosure requirements classified into 7 topics in the Economic category
as set out below.

Economic
Economic
Performance

Tax

Anticompetitive
BehaviourMarketPresence
Indirect
Economic
Impacts

Anticorruption

Procurement
Practices

REPORTING ON LABOUR PRACTICES & DECENT WORK
Economic
Performance
80
70

68

60

MarketPresence

Indirect
Economic
Impacts

Tax

65
55 52
49

51

50

Anticompetitive
Behaviour

Procurement
AntiPractices
corruption

40

33

30

45 43
41

41 39
37

30 32

27

24

20
10

Sustainability Reporting In Sri Lanka 2023

207-4

207-3

207-2

207-1

206-1

205-3

205-2

205-1

204-1

203-2

203-1

202-2

202-1

201-4

201-3

201-2

201-1

0

17

Economic Performance
Only 33 companies reported on 201-4: Financial assistance received from the government which
could be attributed to this not being material for many sectors. Although 51 corporates reported on
201-2: Financial implications and other risks and opportunities due to climate change, it is notedthat this number should be higher due to its relevance to all sectors and potential impacts of climatechange. The absence of reporting in the Energy sector is an example as most companies rely on
renewable energy within this sector and climate change plays a key role. Higher levels of awareness of
this topic is also necessary for adoption of IFRS Sustainability Standards, particularly IFRS S2: Climate
Disclosures.

REPORTING ON ECONOMIC PERFORMANCE
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

201-1

201-2

201-3

2

4

6

8

10

12

201-4

Disclosure Requirements

Reporting (out of 71
GRI reports)

201-1

Direct Economic Value Generated and Distributed

96%

68

201-2

Financial Implications and other Risks & Opportunities due toclimate change

72%

51

201-3

Defined Benefit Plan Obligations and Other Retirement Plans

92%

65

201-4

Financial Assistance received from Government

46%

33

18

Sustainability Reporting In Sri Lanka 2023

Market Presence, Indirect Economic Impacts and Procurement
Practices
For entities identifying the above topics as material, the GRI 3 guidelines provide guidance on 5
indicators that companies could report on, as listed below.

REPORTING ON MARKET PRESENCE, INDIRECTECONOMIC IMPACTS AND PROCUREMENT PRACTICES
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

204-1

203-2

203-1

2

202-2

4

6

8

10

202-1

Disclosure

Requirements

Reporting (out of
71 GRI reports)

202-1

Ratios of standard entry level wage by gender

42%

202-2

Proportion of senior management from local community

45%

Indirect Economic Impacts
203-1

Infrastructure investment and services supported

77%

203-2

Significant indirect economic impacts

73%

Procurement Practices
204-1

Proportion of spending on local suppliers

Sustainability Reporting In Sri Lanka 2023

69%

19

Many organisations do not consider market presence a material topic, largely due to the inclusion of
202-2 in the topic standard as most corporates have hired senior management from the country which
results in a low level of reporting. However, 202-1 is a key indicator of economic well-being of theworkforce, which was critical in 2022 as the country saw inflation increase to 73.7%4 as measured by
the National Consumer Price Index. According to the Annual Report of the Central Bank of Sri Lanka,
wages of the formal private sector employees whose wages are governed by wage boards increased
by 9.8%4 during the year while real wages declined by 22.7%4. Given the developments that took
place during the year, it is reasonable to expect that the Market Presence indicator was considered asa material topic as many organisations increased wages in response to the developments.
It is also important for companies to consider the proportion of spending on local suppliers given
the country’s need to manage the trade deficit and the import restrictions in place to encourage local
purchasing.

4

20

Annual Report 2022, Central Bank of Sri Lanka
Sustainability Reporting In Sri Lanka 2023

Anti-corruption and Anti-competitive Behaviour
The GRI Guidelines include 4 indicators for reporting on anti-corruption and anti-competitive
behaviour, if they are identified as material aspects as set out below.

REPORTING ON ANTI-CORRUPTION & ANTI-COMPETITIVE BEHAVIOUR
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy0206-1Disclosure

205-3

205-2

1

2

3

4

5

6

7

8

205-1

Requirements

Reporting (out of
71 GRI reports)

Anti-corruption
205-1

Assessment of operations for risks related to corruption

58%

205-2

Anti-corruption policies, procedures and training

55%

205-3

Incidents of corruption and action taken

52%

Anti-Competitive behaviour
206-1

Legal actions for anti-competitive behaviour

38%

The country’s economic challenges are likely to have resulted in lower prioritisation of anti-corruption.
However, it is necessary that corporates also consider the country’s declining scores and ranking in
the Corruption Perceptions Index compiled by Transparency International when determining material
matters, as Sri Lanka ranked at 101 out of 180 countries scoring 36 out of 100.5 It is likely to be ofimportance to corporates with significant overseas stakeholders.
52022 Corruption Perceptions Index Report_CPI2022_English.pdf (transparencycdn.org)

Sustainability Reporting In Sri Lanka 2023

21

Tax
The GRI 3 guidelines encourage reporting entities to be guided by the following indicators in relation
disclosures pertaining to tax:

REPORTING ON TAX
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

207-4

207-3

207-2

1

2

3

4

5

6

7

8

207-1

Disclosure Requirements

Reporting(out of 71 GRI reports)

207-1

Approach to tax

63%

207-2

Tax governance, control and risk management

61%

207-3

Stakeholder engagement and concerns related to tax

58%

207-4

Country by country reporting

34%

Organisational context should have exerted pressure to make Tax a material topic for many corporates
given the increase in tax rates during the financial year under review. This calls into question therationale for the relatively low level of reporting on tax observed for 207 -1, 207-2 and 207-3,
particularly as the quantitative information would be available in the financial statements. It could
point to the separation of sustainability risks from the enterprise risk management process which
weakens the overall assessment of material topics. The low level of reporting on 207-4 could be
attributed to operations currently being confined to Sri Lanka.

22

Sustainability Reporting In Sri Lanka 2023

Environment

The GRI Standards have 32 disclosure requirements classified into 8 topics in the Environment category
as set out below.

Environment
Supplier
Environmental
Assessment

Materials

Effluents andWaste

EnergyWater

Emissions
Biodiversity

Materials

EnergyWater Biodiversity

EmissionsEffluents and Compliance Supplier
Environmental
Waste
Assessment

80
70

64

40
30
20

55
41
33
19

46
24

30

54 52

50
4346 44
35

10

39

44 46

26
21 23
13

1112
305-1
305-2
305-3
305-4
305-5
305-6
305-7

50

304-1
304-2
304-3
304-4

60

54
48 49

42
37

33
25
9

Sustainability Reporting In Sri Lanka 2023

307-1
308-1
308-2

306-1
306-2
306-3
306-4
306-5

303-1
303-2
303-3
303-4
303-5

302-1
302-2
302-3
302-4
302-5

301-1
301-2
301-3

0

23

Materials
There has been significant progress in reporting on this since the previous survey in 2015 with asubstantial increase in the number of companies reporting on 301-1 and 301-2 as given below.

REPORTING ON MATERIALS
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

301-3

301-2

2

6

8

10

Reporting (out of
71 GRI reports)

2015

Increase

41

17

141%
660%

301-1

Disclosure Requirements
301-1

4

Materials used by weight or volume

58%

301-2

Recycled input materials used

46%

33

5

301-3

Reclaimed products and their packaging
materials

27%

19

-

Despite the progress, it is necessary to encourage more corporates to report on these key metrics tounderstand and manage their dependence on natural resources and their availability. The potential
upside from improved management of materials is a critical factor that organisations must consider, as
it drives sustainable product and process innovation, supporting both top line and bottom-line growth.

24

Sustainability Reporting In Sri Lanka 2023

Energy
Energy is a material topic for corporates in Sri Lanka as the country experienced an energy crisis during2022 with planned power outages for over 10 hours. Additionally, energy costs increased significantly withpetrol, auto diesel and electricity tariffs increasing by 109%, 247% and 75% in 2022 respectively.6

REPORTING ON ENERGY
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

302-5

302-4

302-3

2

302-2

4

8

10

12

302-1

Disclosure Requirements
302-1

6

Energy consumption within the organization

Reporting (out of
71 GRI reports)
90%

No. in2015

Increase

37

73%

64

302-2

Energy consumption outside the organization

34%

24

7

243%

302-3

Energy intensity

65%

46

17

171%

302-4

Reduction of energy consumption

77%

55

30

83%

302-5

Reductions in energy requirements of products
and services

42%

30

10

300%

Considering the developments in this topic during the year, the low numbers in reporting on 302-2
to 302-5 is a concern. Corporates stand to gain significantly by formulating comprehensive energy
strategies as the country moves towards a low-carbon economy.
6

Annual Report 2022, Central Bank of Sri Lanka 8_Chapter_04.pdf (cbsl.gov.lk)

Sustainability Reporting In Sri Lanka 2023

25

WaterSri Lanka is ranked at #19 for water stress with 90.79%7 measured as the level of freshwater withdrawals
as a proportion of available freshwater resources. Consequently, it is a material topic for sectors thatuse water in their manufacturing, cooling and other processes.

REPORTING ON WATER
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

303-5

303-4

303-3

2

303-2

4

6

8

10

12

303-1

Disclosure Requirements

Reporting (out of 71
GRI reports)

No. in2015

Increase

303-1

Interactions with water as a sharedresource

70%

50

*

-

303-2

Management of water dischargerelated impacts

61%

43

*

-

303-3

Water withdrawal

65%

46

31

48%

303-4

Water discharge

49%

35

*

-

303-5

Water consumption

62%

44

*

-

*Not required under GRI G4 Guidelines.
When reporting on 303-3, corporates with facilities in Sri Lanka should be reporting on water stress,
as Sri Lanka is a water stressed country. Attention is also drawn to the Tables provided in the standard
to support better reporting.
Level of water stress: freshwater withdrawal as a proportion of available freshwater resources - Sri
Lanka | Data (worldbank.org)

7

26

Sustainability Reporting In Sri Lanka 2023

Biodiversity
Sri Lanka is one of 36 identified biodiversity hotspots identified by Conservation International using
strict criteria:•

Contain at least 1,500 species of vascular plants found nowhere else on Earth (known as “endemic” species).

•

Have lost at least 70 percent of its primary native vegetation

CSE has at least 19 Plantation companies in the Food, Beverage and Tobacco sector and 36 companies
in the Consumer Services sector which comprises hotels. However, only 7 entities in the former and 2
entities in the latter sector report on this topic. Entities in these two sectors not only have a high impact
on biodiversity but also stand to gain significantly from monitoring and managing this topic.

REPORTING ON BIODIVERSITY
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

304-4

304-3

304-2

1

2

3

4

5

6

7

8

304-1

Disclosure Requirements

Reporting (outof 71 GRI reports)

No. in2015

Increase

304-1

Operational sites owned, leased, managed in or
adjacent to, protected areas and areas of highbiodiversity value outside protected areas

30%

21

16

31%

304-2

Significant impacts of activities, products, andservices on biodiversity

37%

26

7

271%

304-3

Habitats protected or restored

32%

23

5

360%

304-4

IUCN Red List species and national conservation list
species with habitats in areas affected by operations

18%

13

5

160%

Sustainability Reporting In Sri Lanka 2023

27

Emissions
Sri Lanka was ranked 46 out of 131 countries for the worst air quality in 2022 by IQAir and theaverage PM 2.5 concentration was 4.1 times the World Health Organisation guideline air quality
value.8 Compliance with these disclosures also indicate readiness of the market for IFRS Sustainability
Standards as these metrics are included in the IFRS S2: Climate Disclosures standard. Given these
considerations, the level of reporting is low with a maximum of 54 corporates ready to report Scope
1 emissions. Given the focus of the world and the country to move to a low carbon economy, more
corporates are encouraged to treat this as a material topic and manage its impacts by reporting onthese metrics.
8

Sri Lanka Air Quality Index (AQI) and Air Pollution information | IQAirREPORTING ON EMISSIONS
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

305-7

28

305-6

305-5

305-4

2

4

6

305-3

8

305-2

10

12

305-1

Sustainability Reporting In Sri Lanka 2023

Disclosure Requirements

Reporting (out of 71
GRI reports)

No. in2015

Increase
Vs 2015305-1

Direct (Scope 1) GHG Emissions

76%

305-2

Energy indirect (Scope 2) GHG
Emissions

73%

54

22

145%

52

21

148%

305-3

Energy indirect (Scope 3) GHG
Emissions

55%

39

13

200%

305-4

GHG Emissions intensity

62%

44

16

175%

305-5

Reduction of GHG emissions

65%

46

22

109%

305-6

Emissions of ozone-depleting
substances

15%

11

7

57%

305-7

Nitrogen oxides (NOX) sulfur oxides(SOX, and other significant air
emissions

17%

12

7

71%

Capacity building in compiling, managing and auditing these metrics is key to achieving regular andbroad-based reporting among corporates.

Sustainability Reporting In Sri Lanka 2023

29

WasteWaste and effluent management are national challenges with a waste collection rate of 27% out of
which 85% is disposed through open dumping.9 Only 5% of collected waste is recycled indicating
significant upside potential for recycling. Given the scale of the challenge, more corporates must be
encouraged to consider reporting on these metrics with a view to institutionalising the 9Rs frameworkof a circular economy.
RefuseRecycleRethinkRepurpose

9R Framework
for a circular
economyReduceRe-useRemanufacture
RepairRefurbish

REPORTING ON WASTE AND EFFLUENTS
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

306-5
9

30

306-4

306-3

2

306-2

4

6

8

10

12

306-1

_unh-sri_lanka-country-report-2023.final_revised.pdf (unhabitat.org)
Sustainability Reporting In Sri Lanka 2023

Disclosure Requirements

Reporting (out of 71
GRI reports)

306-1

Waste generation and significant
waste-related impacts

68%

48

306-2

Management of waste-related
impacts

76%

54

306-3

Waste generated

69%

49

306-4

Waste diverted from disposal

52%

37

306-5

Waste directed to disposal

59%

42

Sustainability Reporting In Sri Lanka 2023

No. in2015

Increase
Vs 2015

Not considered as
the metrics are notcomparable

31Compliance & Supplier Environmental Assessment
These two topics have been analysed together for conciseness. Considering the scale of theenvironmental challenges set out in other topics, all corporates should be encouraged to invest inassessing environmental practices of their suppliers driving efficiencies in the upstream activities of thevalue chain. Reducing the environmental impact is a compelling value proposition to boost the bottom
line through reduced consumption and elimination of waste

REPORTING ON SUPPLIER ENVIRONMENTAL ASSESSMENT &ENVIROMENTAL GRIEVANCE MECHANISMS
Utilities
Transportation
Telecommunication Services
Software & Services
Retailing
Real Estate Management & Development
Materials
Insurance
Household & Personal Products
Health Care Equipment & Services
Food, Beverage & Tobacco
Food & Staples Retailing
Diversified Financials
Consumer SErvices
Consumer Durables & Apparel
Commercial & Professional Services
Capital Goods
Banks
Automobiles & Components
Energy
0

308-2

308-1

1

2

3

4

5

6

307-1

Disclosure Requirements

Reporting (out of
71 GRI reports)

No. in2015

Increase
Vs 2015

Compliance
307-1

Non-compliance with environmental laws andregulations

13%

9

Supplier environmental assessment
308-1

New suppliers that were screened using
environmental criteria

46%

33

308-2

Negative environmental impacts in the supply
chain and actions taken

35%

25

32

Metrics are notcomparable with2015

Sustainability Reporting In Sri Lanka 2023

SocialThis social topics have been arranged into the following categories for presentation purposesLabour Practices &Decent Work

Local
Communities

Human Rights

Product
Responsibility

SocialSustainability Reporting In Sri Lanka 2023

33

Labour Practices & Decent Work
100% Reporting on at least one aspect of Labour Practices & Decent Work reflects the relevance of
this topic to corporate. It is also encouraging to note the increase compared to 73% recorded in 2015.
Key observations from the survey are noted alongside the relevant graphs.

REPORTING ON LABOUR PRACTICES & DECENT WORK
Labour/
Employment Management
Relations
80
70

69

64

60

57

55

50

44

52 53 51

Diversity &Equal
Opportunity

Training &Education

Occupational Health & Safety

65 64 62

55 56
46 44

59

49

40

39

34

30
20
10

Disclosure Requirements

Reporting (out of 71
GRI reports)

405-2

405-1

404-3

404-2

404-1

403-10

403-9

403-8

403-7

403-6

403-5

403-4

403-3

403-2

403-1

402-1

401-3

401-2

401-1

0

No. in2015

Increase
Vs 2015

42

64%

33

94%

17

224%

22%

Employment
401-1

New employee hires and employee
turnover

97%

69

401-2

Benefits provided to full-time
employees that are not provided totemporary or part-time employees

90%

64

Parental leave

77%

55

62%

44

36

401-3

Labour/Management Relations
402-1

Minimum notice periods regarding
operational changes

Occupational Health & Safety
403-1

Occupational health and safety
management system

80%

57

-

403-2

Hazard identification, risk assessment,
and incident investigation

73%

52

-

34

Sustainability Reporting In Sri Lanka 2023

Disclosure Requirements

Reporting (out of 71
GRI reports)

No. in2015

Increase
Vs 2015

Employment
403-3

Occupational health services

75%

53

-

403-4

Worker participation, consultation,and communication on occupational
health and safety

72%

51

-

403-5

Worker training on occupational
health and safety

77%

55

-

403-6

Promotion of worker health

79%

56

-

403-7

Prevention and mitigation ofoccupational health and safety
impacts directly linked by business
relationships

65%

46

-

403-8

Workers covered by an occupational
health and safety management system

62%

44

-

403-9

Work-related injuries

69%

49

-

403-10Work-related ill health

48%

34

-

Training & Education
404-1

Average hours of training per year per
employee

92%

65

43

51%

404-2

Programs for upgrading employee
skills and transition assistanceprograms

90%

64

36

78%

404-3

Percentage of employees receiving
regular performance and careerdevelopment reviews

87%

62

29

114%

Diversity & Equal Opportunity
405-1

Diversity of governance bodies andemployees

83%

59

12

392%

405-2

Ratio of basic salary and remunerationof women to men

55%

39

28

39%

Sustainability Reporting In Sri Lanka 2023

35

Employment and Labour Management Relations
Sri Lanka has a female labour force participation rate of 32.1% and parental leave is key to improving
this key metric. While 77% of GRI reports have identified parental leave as a material topic, there
is further progress needed in this area. The reporting practices also raised concerns on selection ofmaterial matters. One GRI report recorded significant changes in policy to introduce parental leave
well beyond legal requirements but failed to identify parental leave as a material topic in the GRI
Content Index and also has not provided metrics or targets.

REPORTING ON HEALTH & SAFETY #1
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy0403-10

36

403-4

403-3

2

403-2

4

6

8

10

12

403-1

Sustainability Reporting In Sri Lanka 2023

Occupational Health & Safety
Reporting on Occupational Health & Safety has significantly improved with all companies with the
GRI Index reporting at least one aspect. Out of the companies reporting on OHS, majority are fromthe Food, Beverage & Tobacco, capital goods, consumer durables, materials etc. for which this is likely
to be a material topic.

REPORTING ON HEALTH & SAFETY #2
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy0403-10

403-9

403-8

Sustainability Reporting In Sri Lanka 2023

2

403-7

4

6

8

10

12

403-6

37

Training & Education
Reporting on training and education is also encouraging with many corporates considering this as amaterial topic.

REPORTING ON TRAINING & EDUCATION
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

404-3

38

404-2

2

4

6

8

10

12

404-1

Sustainability Reporting In Sri Lanka 2023

Diversity & Equal Opportunity
While there are 59 corporates reporting on 405-1: Diversity of governance bodies and employees, it
is noticeable that the number reporting on 405-2: Ratio of basic salary and remuneration of women tomen, is noticeably much lower at just 39. This is a clear example of a need to dig deeper on a topic thatis material and where the solutions are just beginning to be addressed. It is a concern that the gender
pay gap information is not readily available as it should be a core requirement of any organization thatis trying to address the topic in a meaningful manner.

REPORTING ON DIVERSITY & EQUAL OPPORTUNITY AND
EQUAL REMUNERATION FOR MEN & WOMEN
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

405-2

2

4

6

8

10

405-1

Sustainability Reporting In Sri Lanka 2023

39

Human Rights
Reporting on 406-1 is relatively high with 72% of reporting entities selecting this as a material topic.
There is a noticeable increase in reporting on human rights but for many corporates, this has notbeen a material topic as many of these are hygiene factors. Careful screening processes are also inplace to ensure that there is no negative impact on the reputation of the corporates. Efforts madein the Plantation companies (within the Food, Beverage and Tobacco sector) (within the to changeorganization cultures in fields to establish dignity of labour in a historically beleaguered industry arecommendable with leading corporates obtaining international certification in this regard.

REPORTING ON HUMAN RIGHTS
60

51

50

42

40

37

30

30
20

12

7

10

Disclosure

Reporting (out of
71 GRI reports)

411-1

410-1

409-1

408-1

407-1

406-1

0

No. in2015

Increase
Vs 2015

28

82%

13

131%

27

167%

27

37%

Non-discrimination
406-1

Incidents of discrimination and corrective
actions taken

72%

51

42%

30

59%

42

52%

37

Freedom of Association and Collective Bargaining
407-1

Operations and suppliers in which the rightto freedom of association and collective
bargaining may be at riskChild Labor
408-1

Operations and suppliers at significant risk forincidents of child labor

Forced or Compulsory Labour
409-1

40

Operations and suppliers at significant risk forincidents of forced or compulsory labor

Sustainability Reporting In Sri Lanka 2023

Disclosure

Reporting (out of
71 GRI reports)

No. in2015

Increase
Vs 2015

12

100%

5

40%

Security Practices
410-1

Security personnel trained in human rights
policies or procedures

17%

12

10%

7

Rights of Indigenous People
411-1

Incidents of violations involving rights ofindigenous peoples

REPORTING ON HUMAN RIGHTS
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

411-1

410-1

409-1

Sustainability Reporting In Sri Lanka 2023

1

408-1

2

3

407-1

4

5

6

7

8

406-1

41

Local Communities
With 62 entities reporting on 413-1 there appears to be significant acceptance of Local Communities
and Compliance as material aspects to organizations which is encouraging while in comparison to
the report published in 2015, the rate of reporting has almost doubled with only 33 entities reportingon this aspect. However, relatively low levels of reporting across other aspects such as Supplier
Assessment for Impacts on Society and Public Policy which are more relevant across many sectors
raises concerns regarding the processes adopted for determining material aspects.

REPORTING ON LOCAL COMMUNITIES
80
70

63

60
50

37

40

35

29

30

18

20

Disclosure Requirements

Reporting (out of 71
GRI reports)

415-1

414-2

414-1

413-1

0

413-2

10

No. in2015

Increase

34

85%

18

105%

12

192%

6

383%

12

50%

Local Communities
413-1

413-2

Operations with local community
engagement, impact assessments anddevelopment programs

89%

63

Operations with significant actual andpotential negative impacts on local
communities

52%

37

Supplier Social Assessment
414-1

New suppliers that were screenedusing social criteria

49%

35

414-2

Negative social impacts in the supply
chain and actions taken

40%

29

25%

18

Public policy
415-1

42

Political contributions

Sustainability Reporting In Sri Lanka 2023

Product Responsibility
All entities following the GRI Index have reported on atleast one aspect of product responsibility,
product service and labelling aspects compared to the results of 2015 where product responsibility
aspects and product service and labelling aspects reporting was not widely prevalent or was notreferenced in the GRI Index of most reports except for the areas on compliance. The majority of thecompanies have reported mainly on 417-1 & 417-2 on marketing and labelling compliance. Sector
wise highest reporting is recorded from the food, beverage & tobacco sector, Banks, Diversified
financials, Materials & consumer durables.
However, the absence of reporting on GRI standards by the Household & Personal products, Food &Staples Retailing sectors reflects poorly on the credibility of reporting within these sectors for which
Product Responsibility must be considered material in the absence of evidence to the contrary. It
underscores the urgent need to encourage these sectors to adopt a holistic approach to balanced
narrative reporting which will strengthen the organisations ability to deliver sustained value in thelong term.

REPORTING ON LOCAL COMMUNITIES
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

415-1

414-2

414-1

Sustainability Reporting In Sri Lanka 2023

2

413-2

4

6

8

10

12

413-1

43

Disclosure Requirements

Reporting (out of
71 GRI reports)

No. in2015

Increase

16

144%

18

128%

16

200%

21

124%

29

41%

25

80%

Customer Health & Safety
416-1

Assessment of the health and safety impacts ofproduct and service categories

55%

39

416-2

Incidents of non-compliance concerning thehealth and safety impacts of products andservices58%

41

Marketing and Labeling
417-1

Requirements for product and service
information and labeling

68%

48

417-2

Incidents of non-compliance concerning productand service information and labeling

66%

47

417-3

Incidents of non-compliance concerningmarketing communications

58%

41

63%

45

Customer Privacy
418-1

Substantiated complaints concerning breaches ofcustomer privacy and losses of customer data

REPORTING ON PRODUCT RESPONSIBILITY
60

39

41

416-1

416-2

50

48

47
41

45

40
30
20
10

44

418-1

417-3

417-2

417-1

0

Sustainability Reporting In Sri Lanka 2023

REPORTING ON PRODUCT RESPONSIBILITY
Utilities
Transportation
Telecommunication Services
Retailing
Real Estate Management & Development
Materials
Insurance
Health Care Equipment & Services
Food, Beverage & Tobacco
Diversified Financials
Consumer Services
Consumer Durables & Apparel
Capital Goods
Banks
Energy
0

418-8

417-3

417-2

Sustainability Reporting In Sri Lanka 2023

2

417-1

4

416-2

6

8

10

416-1

45

Way Forward for Sri Lanka

Sustainability Reporting has gathered momentum since the last survey in 2015, albeit at a slower pace.
This is largely attributable to the loss of momentum during the pandemic year and the financial crisis
that prevailed in 2022. The sustainability reporting landscape has also evolved considerably during
this period with other standards also being used as a basis for reporting. However, GRI Standards
remain the most widely used standard for the purpose.
Sri Lanka’s socioeconomic vulnerabilities are exacerbated by its environmental vulnerabilities andreliance on imported fossil fuels to support its growing demand for energy. The country is also moving
towards a low carbon economy and sustainability reporting will facilitate alignment of corporate
strategies with country strategy. Consequently, there is an urgent need for corporates to strengthenbusiness resilience through a holistic sustainability agenda that is supported by reliable metrics andtargets to objectively monitor progress.
Corporates adopting sustainability reporting will be able to reap significant benefits through costsavings, minimizing waste, sustainable product and process innovation and enhance businessresilience. The upside potential of sustainability reporting is likely to strengthen an organisation’scompetitive advantages and access to markets as countries move towards increased use of non-tariff
trade barriers which may include compliance with social and environmental factors.
Reporting entities are encouraged to review their processes for identifying material topics. As set out
in GRI 3: Material Topics, understanding the sustainability context is important and the country’s
economic, environmental and social challenges must be considered in selecting material topics.
Reporting entities should also avoid reporting across less significant aspects as it compromises thequality of the report, as they become more voluminous. It also raises concerns on greenwashing andwhitewashing by companies, compromising the value of sustainability reporting.
Reporting entities should subject the sustainability information to the same rigorous internal control
processes and review as financial reporting information to enhance the quality of the reports. This
will enable organisations to understand and use the information to support objective decision making
which in turn will support optimal resource allocation and reduce brand vulnerabilities.
It is important to note that Sustainability Reporting initiatives must be led from the front by the CEO andthe Board as reinforced by the GRI Universal Standards. This serves to highlight the importance placedon the processes and encourage a change in the organization culture on awareness and engagementwith sustainability reporting. Sustainability reporting in Sri Lanka needs to evolve to a stage wheretargets can be set for key indicators and only high level commitment can take entities forward towards
this goal.

46

Sustainability Reporting In Sri Lanka 2023

Reporting on diversity and equal opportunity sheds light on the need for corporates to drive meaningfulchange using reliable metrics to understand the issues underlying the topic. Addressing all disclosuresin the topics selected as material topics is highly recommended for corporates that want to move theneedle on the same.
Investing in external assurance on sustainability reports will enhance their credibility and also gain
expertise and insights in to areas for improvement from experts in sustainability reporting. This will alsocollectively drive the quality of reporting across the board as entities implement the recommendations,enhancing their own quality of reporting. Awards and accolades for sustainability reporting also drive
growth in both the number and the quality of reports as entities review and research new developments
to gain an advantage.

Sustainability Reporting In Sri Lanka 2023

47

SheConsults (Pvt) Ltd., has been engaged in providing a full range of services related to Sustainability
Accounting including advisory services and writing content for Corporate Reports since inception in2012 September and counts amongst its clientele some of the largest listed companies in the country.
Our reports consistently rank among the winners at the Corporate Reporting and Sustainability
Reporting awards programmes which has propelled our growth in a relatively short time.

Emagewise (Pvt) Ltd., is the leading Annual Report production house in Sri Lanka with a majority of thecountry’s blue chip companies in its vast portfolio. The Company has produced the highest number ofwinners at the various annual report and sustainability reporting awards.