Following a rigorous due process involving industry consultation, public comment period and approval by the SASB Standards Board, updates to the Apparel, Accessories & Footwear Standard have been published by the Value Reporting Foundation. The thinking behind is to revise and clarify two metrics and technical protocols connected to the Raw Materials Sourcing disclosure topic.
As of June 30, 2022 the Value Reporting Foundation is merging into the IFRS Foundation in order to assist in IFRS Foundation’s establishing of the International Sustainability Standards Board (ISSB). The SASB Standards Board will convert all open standard-setting projects to the International Sustainability Standards Board (ISSB) while ISSB will consolidate the SASB Standards.
In February 2020, the SASB Standards Board favoured the Raw Materials Sourcing in Apparel project, after market input depicting that (1) the definition of priority raw materials required in the SASB Standard was not affiliated with a widely-used industry definition, (2) the shortfall in estimating guidance for measuring materials led to both unrivalled and non-certifiable disclosures and (3) some of the third-party standards suggested are not congruent with the Standard’s guidance on how to calculate the percentage of certified raw materials.
The updated Standard solves this input in four ways. First, the metrics now use the Textile Exchange’s description of priority raw materials comprising materials used in small quantities that may represent critical sourcing risks or opportunities. Second, the quantitative metric has been renewed from percentage to absolute amount of materials. Third, the list of third-party certifications/standards has been revised to comprise those that are actively used by companies and focus on raw materials. Lastly, the updates include minor changes to the disclosure topic summary which endeavour to clarify the focus on how companies handle external environmental and social factors and their impacts on raw materials sourcing.
“As we prepare to transition the work of the SASB Standards Board to the ISSB this summer, we’re pleased to publish this improvement to the Apparel Standard, which is the result of significant outreach and our rigorous due process,” says Dr. Jeffrey Hales, Chair of the SASB Standards Board. “We thank the many stakeholders who have participated in the SASB Standards development process, not only on this project, but throughout all our work over the last 10 years. We encourage everyone who has contributed to the success of the SASB Standards to stay engaged, and a great place to start is by commenting on the ISSB exposure drafts, which reference and build upon the SASB Standards.”
The SASB Standards Board has also launched a Basis for Conclusions document specifying its rationale for the updated Standard, which can be accessed here.
All reporting companies shall utilise the new versions of the Standards for reports covering annual periods beginning on or after July 1, 2022. The last open public Standards Board meeting is on June 15 —register here.
The updated Apparel, Accessories & Footwear Standard can be downloaded here.