Introduction

The report examines the naming and classification of sustainability topics across 33 international frameworks and standards. It highlights the lack of a standardised approach, which complicates impact management practices for businesses, investors, and financial institutions. Sustainability topics, such as labour management, water quality, and climate change, are inconsistently defined and categorised, reducing clarity and coherence in sustainability management resources.

Observations on naming and classification choices

Significant variations in naming and classification of sustainability topics were identified. Different frameworks use varying terms for similar concepts, such as “diversity and inclusion” versus “workforce diversity,” or group topics differently, such as combining “air and climate” versus separating them into “air quality” and “climate change.”

Structural inconsistencies were observed where some frameworks mix drivers (e.g., energy management), objects (e.g., oceans), and subjects (e.g., climate change). For instance, SASB Standards categorise “labour practices” (a driver) separately from “employee health and safety” (a subject), leading to overlaps and ambiguities. Similarly, the European Sustainability Reporting Standards (ESRS) classify pollution as a driver and biodiversity as a subject, resulting in uneven classification logic. These inconsistencies affect the ability to assess impacts comprehensively.

The report also discusses the role of constructs like human rights, well-being, and capitals. These frameworks often conflate broad concepts with narrower issues. For example, human rights may be limited to workforce-related concerns rather than addressing all impacts on stakeholders. This misrepresentation reduces the clarity of sustainability frameworks.

Explanations for differences in the naming and classification of sustainability topics

The inconsistencies stem from functional differences in the frameworks. Management standards often focus on drivers, while reporting frameworks address outcomes or impacts. Multi-stakeholder processes prioritise consensus over conceptual clarity, further contributing to variations. Frameworks also reflect dominant market terminology, which may blur the distinction between practices and outcomes. For example, “diversity, equity, and inclusion” is often used interchangeably to describe policies, practices, and outcomes, creating ambiguity.

Consequences of variations in the naming and classification of sustainability topics

The lack of standardisation impacts robust and holistic impact management. Variations and incomplete coverage of sustainability topics lead to blind spots, limiting organisations’ understanding of their impacts. Misclassification of topics hampers accurate measurement and reporting, potentially causing unintended consequences. For example, neglecting drivers like wage-setting practices in labour management can obscure key factors affecting employee well-being.

Interoperability challenges further exacerbate these issues. Differences in terminology between private and public sector frameworks hinder seamless integration. For instance, ESG ratings often adopt market-driven language that may not align with regulatory frameworks. Misaligned classifications, such as “biodiversity” versus “circular economy,” create barriers to connecting related resources. Similarly, identical terms like “employee health” may encompass different scopes in different frameworks, complicating comparability.

For financial professionals, these inconsistencies limit the ability to assess ESG risks and opportunities accurately. They also hinder comparisons between organisations, affecting investment decision-making and sustainability reporting alignment with regulatory objectives.

Conclusion and recommendations

The report offers three key recommendations:

• Improve conceptual coherence: Frameworks should differentiate drivers, objects, and subjects clearly. For instance, separating practices like “supplier assessments” from outcomes like “worker health” can enhance clarity.
• Enhance connectivity across frameworks: Collaboration among providers is essential to align classifications and nomenclature. Establishing common overarching structures will reduce confusion and improve interoperability.
• Expand understanding of emerging topics: Continuous efforts are needed to refine less-documented sustainability domains. This ensures frameworks remain relevant to evolving challenges and provide comprehensive coverage.

By addressing these issues, sustainability frameworks can support organisations in managing impacts effectively, aligning practices with global sustainability goals, and facilitating better decision-making for financial professionals.