SASB today released the final SASB Rules of Procedure and the SASB Conceptual Framework, two governance documents that establish the principles and processes of SASB’s approach to standards development.
The governance documents were proposed for a 90-day public comment period in early 2016. After considering feedback from the public and the SASB Board of Directors, SASB incorporated three key changes:
- Independent Governance: SASB is adopting a two-tiered governance model with separation of financial responsibilities from the standards-setting activities.
- ANSI process to expert-led process: During the development of provisional standards, SASB was accredited by the American National Standards Institute (ANSI). Going forward, SASB standards will be developed under the authority of the SASB technical board, an expert-led development process.
- Composition of Standards-Setting Body: The SASB will include experts with standards-setting, financial reporting, or sustainability domain knowledge as it relates to material risks, but there will not be designated seat types. Industry expertise will be provided by Sector Advisory Groups, to be formed by the new SASB to provide advice regarding industry and emerging issues.
SASB is now in a period of deep consultation with issuers, investors, and others on the provisional standards prior to finalization in Q4 2017. SASB invites issuers and investors to participate in the consultation process through April 1, 2017. Feedback received will inform the technical agenda for the new SASB board to consider as it contemplates necessary changes to the provisional standards in order to strengthen the materiality, consistency, cost-effectiveness, and decision-usefulness of the standards.