10-K
A document filed annually with the SEC disclosing financial material issues facing publicly traded companies and supporting information. The report provides a comprehensive overview of the company’s business and financial condition and includes audited financial statements. Applicable to U.S. companies that are regulated by the SEC.
AAPI
Asian American and Pacific Islander. A term used to describe the demographic segment of the population with heritage tied to over 50 ethnic groups in over 40 countries in Asia and the Pacific.
Ableism
Discriminating against a person based on their disability status. Many forms of ableism are illegal under the Americans with Disabilities Act (ADA).
Accessibility
The ease with which a person with a disability is provided equal opportunity to access or use a company’s products, services, or employment.
Accommodation
A modification or adjustment to a job, work environment, or hiring process that allows a person with a disability to have equal opportunity to gain employment and succeed at their job. Accommodations are required under the Americans with Disabilities Act (ADA) as long as they are reasonable.
ADA
Americans with Disabilities Act. An Act passed by Congress that prohibits discrimination based on disability status and requires companies to make reasonable accommodations for people with disabilities.
Advised Emissions
An emerging metric that calculates the impact of a professional advisory firm’s services on that firm’s own total emissions. Sometimes advised emissions calculates the entire emissions of a firm’s client list, while other times it is limited to specific projects on which the firm consults.
Ageism
Discrimination against an individual based on their age. In the U.S., employers are barred from discriminating against employees over the age of 40 based on their age.
Anti-ESG
A political movement prevalent in the U.S. whose goals are to remove the consideration of ESG factors in investments, remove corporate DEI programs, and stop climate alliances.
Assurance
The act of verifying a company’s management statements or reports by applying standards of practice specific to the scope and type of the assurance. This is often done through a third party in the form of an audit or assurance engagement. Standards of practice are established by national regulatory bodies with jurisdiction over accounting and differ based on the type, scope and depth of assurance engagements. Assurance typically results in an opinion letter, whereas audits typically result in a list of audit findings to be resolved. In the U.S., financial assurance engagements are conducted only by CPAs.
B Corporation
Benefit Corporation. A for-profit company that has qualified through B Lab by meeting a scoring high enough on B Lab’s ESG assessment and making legal commitments to ESG.
Benchmarking
Comparing data, reports, metrics and other information across organizations to determine how a company’s performance, strategy, goals and other operational undertakings compare to the selected reference group.
Belonging
A metric of how well individuals feel they fit into the overall makeup of an organization. Employers can encourage belonging by supporting their employees, making them feel respected, and providing them with mentors who promote their careers.
Bias
Underlying attitudes, beliefs and stereotypes attributed to people or groups of people. Bias can often be unconscious, causing individuals to act on prejudices they are unaware that they have.
Biodiversity
The variety of living species on Earth, including plants, animals, bacteria, and fungi. It can also be a metric for measuring an ecosystem’s health by determining the variety of species. Areas with low biodiversity can manifest as nature risks.
BIPoC
Black, Indigenous, and People of Color. A term used to describe the demographic segment of the population composed of black, indigenous, and people of color. The term groups them in order to underline their solidarity and shared experience, while also acknowledging the varying types of discrimination faced by these groups individually.
Carbon Allowance
A government-issued permit allowing a company or entity to emit a specific quantity of carbon dioxide equivalent into the atmosphere. Carbon allowances are issued in accordance with specific cap and trade program rules and can be traded between companies under emissions trading systems (ETS). These are not the same as Carbon Credits under voluntary carbon offset markets.
Carbon Credit
A generic term referring to a tradable permit that allows a company to emit a certain amount of CO2 used in compliance-based emissions trading systems (ETS) or voluntary carbon offset markets.
Carbon Footprint
An individual or organization’s total contribution to global CO2 emissions.
Carbon Majors
Large companies within high-emitting sectors such as oil and gas, cement, and refineries, which companies themselves emit the highest amounts of carbon in their sector.
Carbon Neutral
When a company’s total CO2 emissions netted against their offsetting practices result in zero additional CO2 emissions.
Carbon Offsets
A mechanism that creates Carbon Credits by removing carbon from the atmosphere or otherwise negating it (such as by avoiding the emission to begin with). That amount of carbon can then be sold as a Carbon Credit to an emitter who can net their emissions against it resulting in a lower overall carbon footprint.
Carbon Pricing
The price of a carbon credit or allowance in either a regulated ETS or the voluntary carbon market. It can also refer to taxes on carbon emissions and company-specific internal managerial accounting costs assigned to such emissions.
CCAF
Center for Climate Aligned Finance. An organization that promotes climate alignment of policy and practice in the financial sector working with organizations at the firm, sector, and system level.
CCCA
The Collective Commitment to Climate Action. A pledge signed by the signatories to the United Nations Principles for Responsible Banking aimed at aligning pledging to align their portfolios to reflect and finance the low carbon, climate resilient economy.
CCS
Carbon Capture and Sequestration/Storage – The practice of capturing carbon and storing it either in geological structures, as raw materials for use in manufacturing or incorporated into nature or manufactured products. CCS is often used to create Carbon Offsets.
CDP
formerly known as the Carbon Disclosure Project. A non-governmental organization that sponsors and manages a global disclosure system for investors, companies, cities states and regions to disclose issues related to climate change, forests, and water security.
CDSB
Climate Disclosure Standards Board. A now-defunct climate disclosure standard that has since been combined with the IFRS.
CFTC
Commodity Futures Trading Commission. A U.S. regulatory agency that regulates U.S. derivative markets including swaps, futures, and certain kinds of options. The CFTC is moving to regulate Carbon Credits as a derivative and has published draft guidance to regulate the voluntary carbon markets.
Circular Economy
A concept that encourages the design, production, and consumption of products in a way that fully incorporates the reuse and recycling of materials into all aspects of product design, content, use and end-of-life disposition for sustainable production and consumption.
Cisgender
A term used to refer to individuals whose gender identity aligns with their sex at birth.
Climate Risks
Risks to companies arising from the earth’s warming climate, developing public policy/laws, public pressure and litigation on the topic. These include physical risk, litigation risk, and transition risk among others.
CO2
Carbon Dioxide. A gas emitted from the burning of fossil fuels among other activities. One of the major contributing gases to the greenhouse gas effect which results in climate change.
Confirmation bias
The tendency of people to favor information that confirms or strengthens their existing beliefs or values and is difficult to dislodge once affirmed.
Conflict Minerals
Defined by the OECD as minerals derived from areas “identified by the presence of armed conflict, widespread violence or other risks of harm to people. Armed conflict may take a variety of forms, such as a conflict of international or non-international character, which may involve two or more states, or may consist of wars of liberation, or insurgencies, civil wars, etc. High-risk areas may include areas of political instability or repression, institutional weakness, insecurity, collapse of civil infrastructure and widespread violence. Such areas are often characterized by widespread human rights abuses and violations of national or international law.”
Defined by the EU as “Areas in a state of armed conflict, fragile post-conflict areas, as well as areas witnessing weak or non-existing governance and security, such as failed states, and widespread and systematic violations of international law, including human rights abuses.”
Conflict and High-Risk Areas (CAHRAs)
As defined by the OECD: “Conflict-affected and high-risk areas are identified by the presence of armed conflict, widespread violence or other risks of harm to people. Armed conflict may take a variety of forms, such as a conflict of international or non-international character, which may involve two or more states, or may consist of wars of liberation, or insurgencies, civil wars, etc. High-risk areas may include areas of political instability or repression, institutional weakness, insecurity, collapse of civil infrastructure and widespread violence. Such areas are often characterized by widespread human rights abuses and violations of national or international law.”
Defined by the EU as “Areas in a state of armed conflict, fragile post-conflict areas, as well as areas witnessing weak or non-existing governance and security, such as failed states, and widespread and systematic violations of international law, including human rights abuses.”
Consumer Protection
A class of laws, regulations and litigation used to hold companies responsible for false and misleading statements to consumers. Consumer protection statutes are often enforced at a state level by attorneys general and by the FTC at the federal level.
COP
Conference of the Parties. A global summit where countries discuss the climate imperative and attempt to foster international cooperation in mitigating global warming.
CRT
Critical Race Theory. A theory that encourages the examination of racial bias in the formation and operation of social institutions including the criminal justice system, education, and the corporate world.
CSR
Corporate Social Responsibility. A precursor to modern ESG. CSR often focuses more on how a company evaluates and manages its supply chain than on the company’s own operations. CSR also tends to rely heavily on third- party audits of suppliers and involves generally qualitative disclosures and narratives rather than broader, more quantitative and data-focused ESG disclosures.
CSRD
Corporate Sustainability Due Diligence Directive. The EU’s directive governing supply chain due diligence practices by companies. The CS3D requires that companies identify and mitigate issues in a number of ESG areas.
CS3D (CSDDD)
Corporate Sustainability Due Diligence Directive. The EU’s directive governing supply chain due diligence practices by companies. The CS3D requires that companies identify and mitigate issues in a number of ESG areas.
Decarbonization
A technical and strategic management process by which companies and industries reduce their reliance on carbon-creating fuels, chemicals, technologies and processes to reduce their Carbon Footprint.
Deforestation
The removal and destruction of a forest or stand of trees from land that is then converted to non-forest use. Deforestation can involve conversion of forest land to farms, ranches, or urban use.
DEI
Diversity, equity, & inclusion. A large part of the social aspect of ESG, DEI programs seek to foster diversity, equity, & inclusion in corporate, educational and societal settings.
DOL
Department of Labor. A U.S. regulatory body that governs labor relations and worker safety. The DOL also addresses issues related to ESG in pension investments for federal employees.
DOJ
Department of Justice. A U.S. agency tasked with the enforcement of federal law and administration of justice. The DOJ is often involved in environmental justice initiatives at the federal level.
Disability
A physical or mental impairment that substantially limits a person from engaging in regular life activities.
Disclosure
A report either voluntary or mandated, published by a company that describes issues relating to that company’s current and future performance with regard to business matters or other issues the company faces. ESG disclosures often include emissions data, diversity information, and details about governance structure among other topics. While most disclosures are formal, they can also include executive statements in informal venues such as social media, as well as information on product labels and packaging.
Diversity
The overall mix of different employee identities and characteristics (i.e., race, gender, physical abilities, etc) in an organization. High diversity in an organization is tied to increased cultural competency, better public engagement, and more innovative thought.
Divestment
The act of intentionally removing investments from a portfolio. In the context of ESG, this is because of the investment’s association with non-ESG-aligned companies, industries or strategies. Anti-ESG is also known to divest funds from ESG-aligned financial service providers.
DJSI
Dow Jones Sustainability Index. A group of indices composed of top-performing stocks based on their ESG performance. Maintained by S&P Dow Jones and RobecoSAM.
Double Materiality
The idea that a company’s impact on the world, people and society – particularly with regard to climate change and other environmental impacts – can be material and therefore worth disclosing for reasons other than just financial materiality.
EEOC
Equal Employment Opportunity Commission. A U.S. regulator who investigates claims of illegal discrimination. The EEOC can bring suits against companies based on discriminatory practices, or issue a “right to sue” letter so that private parties may bring suits.
EFRAG
European Financial Reporting Advisory Group. The EU body responsible for creating reporting standards for EU sustainability reporting.
ETS
Emissions Trading Scheme. A national system in the EU that places an annual cap on the total allowed greenhouse gas emissions and distributes emissions allowances to companies that may be traded within EU nations.
Environmental
Issues relating to the overall health and stability of the Earth. This includes biodiversity, climate, ocean health, water use, waste management, etc.
Environmental Justice
The idea that privileged communities should not exclusively reap the benefits of a healthy environment and that under-served communities should not have to bear the brunt of environmental degradation. As defined by EPA in the U.S., the term means the “just treatment and meaningful involvement of all people, regardless of income, race, color, national origin, Tribal affiliation, or disability, in agency decision-making and other Federal activities that affect human health and the environment so that people:
- are fully protected from disproportionate and adverse human health and environmental effects (including risks) and hazards, including those related to climate change, the cumulative impacts of environmental and other burdens, and the legacy of racism or other structural or systemic barriers; and
- have equitable access to a healthy, sustainable, and resilient environment in which to live, play, work, learn, grow, worship, and engage in cultural and subsistence practices”
EPA
Environmental Protection Agency. U.S. Regulator that creates and enforces environmental regulations.
Equity
The treatment of people in a way that levels the playing field. Correcting for damages caused by historical wrongs and allowing equal opportunity to access resources, jobs, and promotions.
ESG Fund
A portfolio of investments that align with certain ESG goals. ESG funds are a component of sustainable finance. The investment goals and strategies of ESG Funds can vary significantly.
ESG Ratings
A rating given to a company by a third-party agency that reflects the rater’s evaluation of a company’s performance on ESG issues. ESG Ratings may not be consistent in general or across the same ESG topic.
Ethnicity
A person’s cultural background or descent. Ethnic groups often share language, culture, ancestry, race, and other characteristics. Discrimination based on ethnicity is prohibited in the United States.
EVs
Electric Vehicles. Vehicles that run on electricity rather than fossil fuels.
FASB
Financial Accounting Standards Board. A U.S. not-for-profit private organization that establishes financial accounting and reporting standards under the Generally Accepted Accounting Principles (GAAP).
FCA
Financial Conduct Authority. A UK agency that regulates financial markets. The FCA enforces competition laws and consumer protection laws and ensures the integrity of the UK financial system.
Financed Emissions
The total emissions enabled by an organization’s financing. For example, if a bank loans money to a fossil fuels company for the development of a new fossil fuels project, then the emissions created by that project would add to the bank’s Financed Emissions.
Financial Materiality
In the context of U.S. financial statements the term refers to “those matters as to which an average prudent investor ought reasonably to be informed before purchasing the security registered.” A landmark case in the 1976 US Supreme Court case added that an item is material if there is “a substantial likelihood that a reasonable investor would consider the information important in deciding how to vote or make an investment decision.”
FSOC
Financial Stability Oversight Council. A council within the U.S. Treasury Department that monitors financial stability in the U.S. FSOC publishes annual risk reports highlighting areas of concern that may pose potential systemic risks to the U.S. economy.
FTC
Federal Trade Commission. A U.S. agency that enforces federal competition and consumer protection laws. The FTC publishes the FTC Green Guides for Environmental Marketing, which offers guidance to companies looking to market products based on their sustainability performance.
Fugitive Emissions
Emissions that come from unintended sources such as leaks.
GAAP
Generally Accepted Accounting Principles. U.S. principles of accounting that are required to be used in the financial statements of public companies.
GBF
Kunming-Montreal Global Biodiversity Framework. A framework adopted at COP 15 that established a pathway to promote development in a way that preserves and protects nature.
GCC
Gulf Cooperation Council. A regional intergovernmental union between six Middle Eastern countries. The trade block has its own ESG disclosure guidance.
Gender Identity
The gender that a person identifies with, which may be the same or different from their sex at birth.
GHG
Greenhouse Gases. A class of seven gases that contribute to the greenhouse effect which traps solar radiation and warms the Earth. These include CO2 and Methane among others.
Governance
The internal mechanisms, controls, rules, practices, and processes used to administer, oversee, direct and control a corporation.
Green Bonds
Similar to a traditional corporate or sovereign bond, except the money raised through green bonds is earmarked for specific sustainable projects.
Green Deal
The European plan to reach net zero emissions compared to 1990 levels by 2050. The Green Deal involves many pieces of interworking legislation including the SFDR, CSRD, and consumer protection laws.
Greenhouse Gas Protocol
A comprehensive standardized framework developed and managed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), for calculating an organization’s GHG emissions.
GRI
Global Reporting Initiative. An international framework used for reporting and disclosure on a range of environmental and sustainability topics.
Harassment
Verbal, physical, or visual conduct that is unwelcome or unwanted. Severe or pervasive harassment based on a person’s race, color, national origin, sex, religion, disability, age, or genetic information is illegal in the U.S.
HKMA
Hong Kong Monetary Authority. Financial regulator and banking institution governing Hong Kong.
Human Capital
The combined value brought to an organization by its employees’ skills, knowledge, good health, education, and labor.
ICMA
International Capital Markets Association – An international organization of capital market participants and regulators that promotes principles, rules, and recommendations to improve the health of capital markets.
IDP
Integrated Disclosure Project. An ESG reporting template that seeks to standardize voluntary ESG information reporting.
IEA
International Energy Agency. An international organization that provides analysis, data, and policy recommendations for the energy sector.
IESBA
International Ethics Standards Board for Accountants. A global standard-setting board that establishes accounting and auditing ethics standards for accounting, audit and assurance providers.
IFRS
International Financial Reporting Standards. A global standard-setting agency that creates accounting and, through its International Sustainability Standards Board (ISSB), sustainability standards. The IFRS is the organization responsible for developing the ISSB IFRS 1 and IFRS 2 sustainability disclosure standards which are being adopted in many jurisdictions. The U.S. does not automatically or fully align with/integrate IFRS financial reporting standards; instead, the U.S. follows GAAP.
IIRC
International Integrated Reporting Council. A now-defunct organization that provided standards for integrated reporting. Now a part of the IFRS, former members of the IIRC now serve on the Integrated Reporting and Connectivity Council of the IFRS.
Inclusion
The degree to which members of an organization feel that they belong and are supported by the organization. An inclusive culture makes employees feel that their concerns are being heard and that they are respected by the organization.
Indigenous
Groups that are native to a geographical area and inhabited that area prior to colonialism by a different group.
Integrated Reporting
Reporting that combines traditional financial reporting with non-financial reporting such as ESG reporting to give a better overall picture of that organization’s short, medium, and long-term value and strategy.
Intersectionality
How various aspects that compose a person’s identity combine in a unique way that results in individual discrimination and privileges within society.
IOSCO
International Organization of Securities Commissions. An international body composed of securities regulators that develops, implements, and promotes standards for securities regulation. IOSCO standards must be adopted by individual countries to be implemented and enforceable.
IPCC
International Panel on Climate Change. An international organization that provides governments with scientific information on climate change by reviewing scientific papers and publishing reports based on that information.
ISO
International Organization for Standardization. An international organization that publishes voluntary management systems standards including quality, environmental management, health and safety, energy management and a variety of sustainability-focused topics.
ISS
Institutional Shareholder Services. A provider of corporate governance and responsible investment solutions, market intelligence, fund services, proxy advisory services, and events and editorial content for institutional investors and corporations. They also produce ESG data, analytics, and ratings firms used by investors to evaluate company ESG performance.
ISSB
International Sustainability Standards Board. A subdivision of the IFRS that develops sustainability standards.
Just Transition
The idea that vulnerable people and communities should not be left behind by the climate transition and that governments should adapt economies in such a way that those whose livelihoods were previously dependent on fossil fuels are given new opportunities in the transition economy.
KPI
Key Performance Indicator. A metric that measures progress on a specific issue that is considered important.
LGBTQIA+
Lesbian, gay, bi, trans, queer, intersex, asexual. An acronym used to refer to the community of people who constitute sexual and gender minorities.
Materiality
The importance of an issue to an organization. There are differing views of materiality and different methods for assessing the materiality of an issue. Financial Materiality is often the standard for U.S. regulators while the EU has adopted a Double Materiality standard.
Materiality Assessment
The process by which an organization identifies potentially material issues and evaluates them.
Modern Slavery
The use of forced or child labor in modern supply chains. Modern slavery is often difficult to find as bad actors use bribery and have developed sophisticated practices to avoid detection.
Microaggression
The discriminatory comments, actions, and prejudices that disadvantaged groups deal with on a day-to-day basis. While microaggressions may seem minor, the pervasive nature of microaggressions in society causes tangible harm.
MSCI
Morgan Stanley Capital International. An investment research firm that provides ESG ratings, risk, and performance analytics.
NASDAQ
National Association of Securities Dealers Automated Quotations. An American stock exchange based in New York City. NASDAQ listing requirements sometimes touch on ESG areas, such as the exchange’s board diversity rule.
Nature Risk
Risks posed to organizations by the degrading ecosystems in which they operate. Industries are reliant on the natural environment for raw materials, and as those ecosystems break down, they pose a risk to these industries’ operations.
Nearshoring
The act of restructuring supply chains so that supply chain partners are located physically closer and in “friendlier” countries. The practice is used to enhance supply chain resilience and became popular after the COVID-19 pandemic.
Neurodivergent
A person whose neurological function differs from what is thought of as “standard.” Neurodivergent people include people on the autism spectrum and people with mental illnesses such as ADHD, Depression, and Bipolar. While some neurodivergent people may seek and require treatment, others simply process information differently than the mainstream.
NZAOA
Net Zero Asset Owner Alliance. An international group of institutional investors who are committed to reducing their investment portfolio’s financed emissions to net zero by 2050.
NZAMI
Net Zero Asset Managers Initiative. An international group of asset managers who are committed to reducing their investment portfolio’s financed emissions to net zero by 2050.
Net Zero
When a company’s total GHG emissions netted against their offsetting practices result in zero additional GHG emissions.
NYSE
New York Stock Exchange. An American stock exchange based in New York City. The NYSE occasionally publishes guidelines that are useful to ESG practitioners like their NYSE Best Practices for Sustainability Reporting.
OECD
Organization for Economic Cooperation and Development. An international organization aimed at developing evidence-based standards on a number of ESG issues.
PACTA
Paris Agreement Capital Transition Assessment. An open-source software tool that provides investors and banks with information on how their investments align with limiting global temperatures in line with the Paris Agreement.
Paris Agreement
A legally binding international treaty signed in 2015 aimed at limiting global warming to between 1.5 °C – 2 °C of the pre-industrial level.
PCAF
Partnership for Carbon Accounting Financials. A global partnership of financial institutions aimed at creating GHG emissions calculation standards for the financial industry.
Physical Risk
Risks to physical operations, property and facilities caused by climate change. Examples include severe weather, flooding, and wildfire risks.
Proxy Statement
A document filed with the SEC that discloses material information necessary when soliciting shareholders to participate in proxy voting.
Privilege
The benefits and advantages given to a person based on their identity or belonging to a social group.
Protected Class
A class of identifying characteristics that are legally protected against discrimination. In the U.S. these include age, disability, genetic information, national origin, race, color, religion, and sex.
Psychological Safety
When a person feels safe being their authentic self at work.
Race
A social construct that groups individuals based on physical characteristics.
SASB
Sustainability Accounting Standards Board. An organization that publishes industry standards for identifying sustainability-related risks and opportunities. SASB is part of the IFRS’ ISSB.
SBTi
Science Based Targets Initiative. A UN-backed program that evaluates and approves net-zero transition plans that align with the Paris Agreement’s 1.5°C warming limit.
Scope 1 Emissions
A company’s direct emissions created through company operations.
Scope 2 Emissions
Emissions created through a third party’s generation of electricity that a company uses.
Scope 3 Emissions
Any emissions that are not included in a company’s Scope 1 or 2 emissions. These include emissions resulting from a company’s supply chain activities both upstream and downstream, including product transportation/shipping, employee travel, end-user/customer use of a company’s product(s) and other indirect emissions sources.
SEC
Securities and Exchange Commission. The U.S. federal agency tasked with regulating the securities market and related corporate financial disclosures.
Sexual Orientation
The pattern of sexualities and genders a person is romantically attracted to.
SFDR
Sustainable Finance Disclosures Regulation. A European regulation requiring financial services firms and asset managers to disclose certain information related to how ESG factors are integrated at an entity and product level.
Social
The “S” in ESG. Social issues are those related to people, employee safety, human capital management, DEI, Labor, and human rights in supply changes.
Social Justice
A societal movement aimed at improving equity, equal access to opportunity, and the equitable distribution of wealth.
Social Risks
Risks related to human interactions with a company or its products. This includes employee safety, product safety, labor disputes, boycotts, and reputational damage to a company. Social risk also relates to how a company’s suppliers treat their workers and/or contract employees.
Stakeholder
A person who is impacted by a company’s actions. Customers, employees, regulators and shareholders are all examples of stakeholders. The general public is frequently considered a stakeholder in ESG matters.
Stranded Assets
A company’s asset that loses its value earlier than expected, making it difficult or impossible to sell or recoup the initial investment. This normally occurs because of changes in economic conditions or regulations. Coal-fired power plants and oil reserves are examples of potential stranded assets as countries move away from fossil fuels.
Supply Chain Due Diligence
The process of tracing an organization’s supply chain, identifying potential risks, and mitigating those risks. Supply chain due diligence is often used to address issues occurring in supply chains such as human rights and deforestation.
Supply Chain Tracing
The process of identifying upstream and downstream organizations in a supply chain so that products can be traced back to their raw materials. Useful in calculating scope 3 emissions and supply chain due diligence.
Sustainability-linked bonds
Sovereign or corporate bonds that may be used for general purposes but that are linked to sustainable Key Performance Indicators (KPI). If the issuer fails to meet the KPI, then the bondholder is paid additional payments or avoids paying extra rebates, therefore creating a financial incentive for issuers to meet the KPIs.
Sustainability Report
A document that discloses information related to sustainability issues as well as a company’s efforts to mitigate sustainability risks and seize sustainability opportunities. May also be called other names such as “ESG Report”, “Corporate Responsibility Report”, etc.
Sustainable Finance
A combination of regulations and standards that encourage financial markets to consider ESG factors and impacts.
Taxonomy Regulation
A framework in the EU that classifies economic activity.
TCFD
The Taskforce on Climate-Related Financial Disclosures. A disclosure framework that is used by companies to report on climate-related risks and opportunities. TCDF was absorbed into the IFRS’s ISSB.
TISFD
The Taskforce Inequality and Social-related Financial Disclosures. A risk management framework aimed at providing guidance, thresholds, targets, and metrics to investors and companies looking to reduce inequality stemming from their activities.
TNFD
The Taskforce on Nature-related Financial Disclosures. The TNFD is an independent framework developed to assist companies in identifying and disclosing nature-related risks.
TPT
Transition Plan Taskforce. An organization that has developed a disclosure framework for companies making climate transition plans.
Transgender
A person whose gender identity does not align with their assigned sex at birth.
Transition Economy
Changes to the economy resulting from the transition from high-carbon emitting industries to a net zero economy.
Transition Risks
Risks to organizations stemming from the Transition Economy.
UNDP
United Nations Development Programme. A UN-led agency that focuses on sustainable development, democratic governance, peace-building, and climate and disaster resilience.
UNEP
United Nations Environment Programme. The UN system’s environmental authority that aims to strengthen environmental standards at country, regional, and global levels.
UNEPFI
United Nations Environment Programme Financial Initiative. A subgroup of the UNEP that works with financial institutions to promote sustainable finance around the world.
UNGC
United Nations Global Compact. A voluntary non-binding compact signed by companies pledging to improve their sustainability and social responsibility policies.
UNGP
United Nations Guiding Principles on Business and Human Rights. A framework developed by the UN that addresses human rights abuses in business operations and global supply chains.
UNPRB
United Nations Principles for Responsible Banking. A framework for responsible banking based on six guiding principles developed by the UNEPFI.
UNPRI
United Nations Principles for Responsible Investment. Six principles developed by the United Nations for investors to incorporate ESG and sustainability into their decision-making.
UNSDGs
United Nations Sustainable Development Goals. A set of global goals designed to end poverty, protect the planet, and improve global living conditions.
Veteran Status
Whether or not a person has served in their country’s armed forces.
Voluntary Carbon Market
Financial markets trading carbon credits that are governed by party-to-party contracts/transactions rather than governmental regulations (see Carbon Allowance).
VRF
Value Reporting Foundation. A now-defunct organization that produced sustainability reporting frameworks. Now merged with the IFRS.
XBRL
An electronic system used for the digital filing of company reports.