How can better reporting improve CSR?

While environmental reporting has advanced due to new climate regulations, the social side of sustainability, including human rights, community impact and ethical supply chains, continues to lag behind.

The study reviewed 2023 sustainability disclosures from ASX100 companies and major private firms, finding most reporting focused on internal matters like employee diversity and workplace safety. More complex external impacts were rarely covered, creating a gap that could undermine transparency and long-term performance. Associate Professor Melissa Edwards from UNSW said businesses that neglect social outcomes are missing a key part of the bigger picture.

Key findings and challenges include:

• 97% of ASX100 companies reported on sustainability, yet on average only 55.4% of relevant social topics were disclosed
• Internal metrics were widely reported, while more difficult areas like human rights in procurement (22.58%), socio-economic legal non-compliance (13.98%) and product/service labelling breaches (11.83%) were largely absent
• Scope 3 social factors, such as community impact or supply chain harm, are harder to measure and often avoided
• Unlike climate disclosures, social reporting in Australia is still voluntary, making it easy to deprioritise

To address this gap, the report recommends practical strategies to strengthen social reporting:

• Use a scope-based model similar to greenhouse gas reporting:
  • Scope 1: Internal practices (e.g. diversity, health and safety)
  • Scope 2: Supplier relationships (e.g. fair labour in procurement)
  • Scope 3: Broader value chain and community impact
• Learn from the not-for-profit sector, where measuring social outcomes is essential for funding and accountability
• Make use of technology to streamline reporting, including digital tools that track sentiment or real-time impact

Despite clear solutions, progress is held back by competing priorities, a lack of consistent global standards and limited internal expertise. Prof Edwards said businesses often view social impact as a ‘nice to have’, especially in times of economic pressure. But investing in community wellbeing also improves workplace conditions and builds long-term business resilience.

Better reporting, she argues, comes not only from regulation but from building a culture of awareness and capability. Companies that ignore the ‘S’ do so at their own risk. As she puts it, “Your people live and work in communities. So it only makes sense that your impact on those communities is something you should be measuring.”