Authors: Georgios Vousinas

Title: Towards a Non-Financial Reporting Framework for financial institutions. An ESG-based approach

Abstract

Non-financial reporting (NFR) or ESG (Environmental, Social and Governance) reporting was traditionally thought of as just publishing a sustainability report. However, growing stakeholder expectations together with government as well as industry regulation requirements is increasing the focus on this issue and placing it along with financial reporting on the board room table of (not only) financial institutions. For instance, the EU’s Non-Financial Reporting Directive (Directive 2014/95/EU) outlines a holistic range of topics, under the headings of ethics, society, diversity and the environment, and mandates companies to report their business impact as part of their annual reporting cycle. Therefore, NFR is expanding from general descriptions of policy approaches, to tracking and reporting of quantifiable metrics on the organization’s approach to material issues over time. The aim of this paper is to help financial institutions to better assess and evaluate ESG issues, as well as their associated opportunities and risks, by developing a non-financial reporting framework that can serve as a starting point, hopefully initiating a fruitful academic and business discourse on this critical subject, too.