A new review of corporate sustainability reports has raised some serious red flags. It spotlights the need for greater transparency and accountability from top companies regarding their contribution to harms against ocean health. A 30-member team of researchers from multiple countries has conducted the groundbreaking study, including Jean-Baptiste Jouffray of Stanford University and Professor Jan Bebbington of Lancaster University. They analyzed the annual and sustainability reports from 2018-2020 of the largest ten companies in each sector. These are the top 19 findings from the research, which highlight major gaps in how companies report on their impacts, measure their impacts, and set targets to improve.
The analysis discovered that while companies are increasingly disclosing information related to their operations, many still fall short in providing actionable insights into their effects on marine ecosystems. According to Jouffray, “In theory, the more information companies disclose about their operations, the better you can influence their behavior. That would require someone to do something with that information. Transparency alone is a necessary, but far from insufficient, basis for corporate accountability.
Gaps in Reporting
Beyond simply identifying the impacts companies have reported, the researchers sought to understand the variety of ways these impacts are quantified. Perhaps most strikingly, less than a third of the companies we reviewed included indicators that spoke specifically to the impacts of their operations on biodiversity. None of these indicators was adopted by more than two of these corporations. This omission alone underscores a major failure of standardized reporting protocols.
To know where gaps in sustainability disclosures can be found, Professor Bebbington argued that it’s important to ground our reporting in natural sciences. “Many reporting studies lack the natural science underpinnings to know where there are gaps in company sustainability disclosures,” he noted. This lack of scientific understanding might prevent accountability and transparency measures aimed at corporate actors from reaching their full potential in stemming corporate ecological devastation.
Jouffray shared more about the challenges of corporate reporting in the marine sector. He stated, “Humanity has relied on the ocean for millennia, yet today’s scale and diversity of use are unprecedented.” Climate implications Shipping has increased five times in twenty years. At the same time, offshore wind energy has increased more than 500 times, causing a staggering toll on ocean ecosystems.
Ecological Risks and Opportunities
Additionally, introduction of invasive species is one of the biggest threats facing local ecosystems and local fisheries. The research found that a new invasive species arrives in different parts of the world’s oceans every three days on average. This constant influx usually results in significant harm to native marine species. Jouffray warned that while the increasing use of ocean resources offers opportunities for human well-being, it simultaneously poses severe risks to ecosystems and the communities that rely on them.
The researchers suggest that enhancing transparency in corporate reporting could eventually lead to standards comparable to those seen in financial reporting. As Bebbington pointed out, “An innovation within the research was bringing together insights into several industries who all operate in the same physical domain and, sometimes, are competing for space in which to operate.” Such an interdisciplinary approach might be best equipped to overcome some of the tensions involved in regulating a shared ocean space.
Financial Sector’s Role
The financial sector’s role in encouraging more sustainable practices has been an increasingly hot topic. John Virdin is director of the Ocean Policy Program at Duke University’s Nicholas Institute for Energy, Environment and Sustainability. He is interested to see how capital markets actors can further contribute to advancing ocean objectives. “There has been a lot of interest in the role that the financial sector could play to influence ocean conservation and sustainable use, so we really want to test that idea,” Virdin stated.
Sinai Researchers are eager to study this exciting, new opportunity. They hope that by improving the ocean impacts reported, financial institutions will be encouraged to act in accordance with the data. Virdin posed critical questions about investment decisions in the ocean economy: “If this reporting is improved, would financiers act on that information? Would it change investment decisions in the ocean economy? These are questions we are turning to now.”