New report demonstrates how to use reasonable estimates as a practical way of creating decision-useful sustainability information

Data-related challenges are among the most significant obstacles preventing organisations from producing reliable sustainability information. ACCA’s latest report Sustainability reporting: working with estimates provides practical guidance on how to create sustainability information when data is incomplete, uncertain or unavailable.

Organisations are currently working with imperfect data to create sustainability information. When hard figures aren’t available, organisations may use reasonable and supportable information to make assumptions of a present or a future situation, to guide decisions.

Md. Sajid Khan, director at ACCA India said: ‘As sustainability reporting frameworks continue to evolve in India, organisations are navigating both regulatory expectations and practical data challenges. This guidance acknowledges that while robust measurement remains the goal, businesses often need to work with incomplete or developing datasets in the interim. What is important is not perfection at the outset, but transparency, sound judgement and a clear commitment to continuous improvement. Finance professionals are central to this journey bringing structure, discipline and credibility to sustainability information as organisations strengthen their reporting capabilities over time.’

The report explores the current approaches to estimate sustainability information for present situations. These approaches include using third-party or proxy data and deriving sustainability data from financial and other data.

In addition, some organisations are pursuing better-quality data through these measures:

§  ensuring staff know why they’re collecting data

§  designing systems and processes to collect sustainability data

§  integrating systems and processes, as much as possible

§  implementing processes and controls, and

§  collaborating with the value chain.

While the pursuit of reliable sustainability data through direct measurement should continue, it needs to be acknowledged that estimates are sometimes necessary due to uncertainty or our evolving understanding of what needs to be measured. In the absence of high-quality data, the iterative improvements of estimates is a practical way of creating decision-useful sustainability information.

Reasonable estimates do not undermine the usefulness of the information if the estimates are accurately described and explained. Estimates should be revised over time to produce more decision-useful information as

§  knowledge of a sustainability topic improves,

§  assumptions are refined,

§  processes and systems improve, and

§  better-quality data becomes available.

Read the report online.