The Tribune

A Bahamian accountant has called on the Caribbean to adopt a united front over how mandatory environment, social and governance (ESG) reporting standards will be embraced in regional laws and regulations.

Kevin Cambridge, PricewaterhouseCoopers (PwC) Bahamas advisory leader, was among the speakers on a panel discussion at the recent Institute of Chartered Accountants of the Caribbean’s 40th annual conference that focused on the new mandatory ESG reporting standards from the International Sustainability Standards Board (ISSB).

Issued on Monday, the ISSB published its first two completed standards. These are S1: General requirements for disclosure of sustainability-related financial information; and S2: Climate-related disclosures. These are part of global trends moving from voluntary to mandatory reporting on such issues.

Mr Cambridge said: “With pronouncements handed down from the likes of IFRS (International Financial Reporting Standards), the question, then, is what will now be codified in local regulations? The answer is that we need to come together.

"Individually we - governments and businesses - are looking at the world through the lens of our own country, The Bahamas, Barbados, Jamaica, Trinidad etc. It’s not as impactful to think individually when you sit across the table and have very targeted regulatory discussions that ultimately impact all of us across the Caribbean and the globe.”

The standards are intended to be the foundation for a comprehensive global baseline of sustainability disclosures specifically focused on the needs of investors and the financial markets. They should be welcomed by investors and businesses given the complex reporting landscape.

For many Caribbean businesses that are in the infancy of their sustainability journey, now is the time to begin the process. For businesses more advanced, and which have already adopted industry specific and Task Force on Climate-Related Financial Disclosures (TCFD) recommendations, they will be in a better place to apply the two ISSB standards.

As well as the new standards, the panel discussed more broadly the impact of excluding sustainable development goals (SDGs) as an investor and business given that there is a mutual dependency. “An investor or company choosing to invest that doesn’t show, prove or are simply not being strategic by incorporating SDGs into their business, will find themselves being unable to invest in certain opportunities," Mr Cambridge said.

"This also complicates matters as the question then becomes...how do you measure, benchmark and report the ESG framework? If businesses want to add value, they must make both social impact and SDG alignment a part of their core business.” Businesses that take an active role in leading this transformation, and position SDGs at the heart of operational decisions, will be better placed to harness emerging market opportunities, manage risks and achieve a net zero future.

Mr Cambridge added: “At PwC, we believe ESG has to be a priority for every government and business across the Caribbean.”