Industry Comparison

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Current language: English (2023)

You are viewing information about the following Industries:

  • Apparel, Accessories & Footwear The Apparel, Accessories & Footwear industry includes entities involved in the design, manufacturing, wholesaling and retailing of various products, including adult and children’s clothing, handbags, jewellery, watches and footwear. Products are manufactured primarily by vendors in emerging markets, thereby allowing entities in the industry to focus on design, wholesaling, marketing, supply chain management and retail activities.
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  • Consumer Finance The Consumer Finance industry provides loans to consumers. The largest segment of the industry is comprised of revolving credit loans through credit card products. Additional loan services include auto, micro lending, and student loans. Some entities in the industry also provide consumer-to-consumer money transfers, money orders, prepaid debit cards, and bill payment services. Industry performance is determined by consumer spending, rates of unemployment, per capita GDP, income, and population growth. Recent shifts toward consumer protection and transparency have aligned and will continue to align the interests of society with those of long-term investors. Entities that effectively manage their social capital will therefore be better positioned to maximise their financial capital.
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Relevant Issues for both Industries (6 of 26)

Why are some issues greyed out? The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.

Disclosure Topics

What is the relationship between General Issue Category and Disclosure Topics? The General Issue Category is an industry-agnostic version of the Disclosure Topics that appear in each SASB Standard. Disclosure topics represent the industry-specific impacts of General Issue Categories. The industry-specific Disclosure Topics ensure each SASB Standard is tailored to the industry, while the General Issue Categories enable comparability across industries. For example, Health & Nutrition is a disclosure topic in the Non-Alcoholic Beverages industry, representing an industry-specific measure of the general issue of Customer Welfare. The issue of Customer Welfare, however, manifests as the Counterfeit Drugs disclosure topic in the Biotechnology & Pharmaceuticals industry.
  • Apparel, Accessories & Footwear Remove
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    • Customer Privacy The category addresses management of risks related to the use of personally identifiable information (PII) and other customer or user data for secondary purposes including but not limited to marketing through affiliates and non-affiliates. The scope of the category includes social issues that may arise from a company’s approach to collecting data, obtaining consent (e.g., opt-in policies), managing user and customer expectations regarding how their data is used, and managing evolving regulation. It excludes social issues arising from cybersecurity risks, which are covered in a separate category.
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    • Data Security The category addresses management of risks related to collection, retention, and use of sensitive, confidential, and/or proprietary customer or user data. It includes social issues that may arise from incidents such as data breaches in which personally identifiable information (PII) and other user or customer data may be exposed. It addresses a company’s strategy, policies, and practices related to IT infrastructure, staff training, record keeping, cooperation with law enforcement, and other mechanisms used to ensure security of customer or user data.
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    • Product Quality & Safety The category addresses issues involving unintended characteristics of products sold or services provided that may create health or safety risks to end-users. It addresses a company’s ability to offer manufactured products and/or services that meet customer expectations with respect to their health and safety characteristics. It includes, but is not limited to, issues involving liability, management of recalls and market withdrawals, product testing, and chemicals/content/ingredient management in products.
      • Management of Chemicals in Products Chemical safety regulations demonstrate regulatory and stakeholder concern surrounding the use of harmful or potentially harmful substances in consumer products, including apparel, accessories and footwear. Finished apparel and footwear products have been found to contain traces of chemicals that have been banned or regulated. Depending on the chemical, the amount present in a product and the type of exposure, specific substances can be carcinogenic and can disrupt hormone activity in humans and other organisms. Failure to manage this issue may generate increased regulatory oversight and affect an entity’s social licence to operate. The presence of harmful chemicals in products can result in recalls, litigation and reputational damage. Entities in this industry can examine the design, manufacturing and end-of-life phases to manage the creation, use and disposal of products containing chemicals of concern, develop safe alternatives and eliminate banned chemicals. Given the industry’s reliance on outsourced manufacturing, this involves proactive partnerships with suppliers. In managing this issue, entities must balance the hazards posed by some chemicals against the quality of a product and its costs of production.
    • Selling Practices & Product Labeling The category addresses social issues that may arise from a failure to manage the transparency, accuracy, and comprehensibility of marketing statements, advertising, and labeling of products and services. It includes, but is not limited to, advertising standards and regulations, ethical and responsible marketing practices, misleading or deceptive labeling, as well as discriminatory or predatory selling and lending practices. This may include deceptive or aggressive selling practices in which incentive structures for employees could encourage the sale of products or services that are not in the best interest of customers or clients.
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    • Supply Chain Management The category addresses management of environmental, social, and governance (ESG) risks within a company’s supply chain. It addresses issues associated with environmental and social externalities created by suppliers through their operational activities. Such issues include, but are not limited to, environmental responsibility, human rights, labour practices, and ethics and corruption. Management may involve screening, selection, monitoring, and engagement with suppliers on their environmental and social impacts. The category does not address the impacts of external factors – such as climate change and other environmental and social factors – on suppliers’ operations and/or on the availability and pricing of key resources, which is covered in a separate category.
      • Environmental Impacts in the Supply Chain The Apparel, Accessories & Footwear industry’s global supply chain contributes significantly to adverse environmental externalities through water consumption and various forms of pollution. Water pollution results from the discharge of chemicals during water-intensive dyeing and tanning processes. Air pollution stems from the industry’s energy use and some manufacturing processes. These impacts have the potential to damage an entity’s reputation and to affect cost structures over time. The scale of this issue has been intensified historically by the industry relying on manufacturing partners in emerging markets with limited environmental regulations and oversight. However, enhanced stakeholder and consumer scrutiny, coupled with increasingly stringent regulation in some regions, has encouraged entities throughout the industry to work with suppliers to reduce their environmental impact. Apparel, Accessories & Footwear entities that leverage their market power to influence suppliers to improve operational efficiencies and resource consumption and limit pollution can mitigate the costs associated with increased resource scarcity and regulation. Further, those that engage with suppliers through monitoring, auditing and strict standards may better preserve shareholder value over the long term.
      • Labour Conditions in the Supply Chain The treatment of workers and the protection of worker rights in the Apparel, Accessories & Footwear industry’s supply chain is of growing concern among consumers, regulators and leading entities. Critical aspects of this issue include employee health and safety, fair pay, child labour and forced labour. Although many entities strive to improve supply chain labour conditions, the industry’s reliance on a multitiered system of suppliers, subcontractors, labour recruitment firms and part-time workers makes these issues difficult to manage. Because entities in the industry typically contract with suppliers in countries with the lowest direct costs, the industry’s products often are manufactured in countries with limited regulations or enforcement protecting workers. This dynamic can increase an entity’s exposure to reputational risks. Effects on short- and long-term costs and sales can arise from increasing regulation and enforcement in response to high-profile safety or labour incidents, production disruptions because of strikes and other labour-related work stoppages, or through a shift in demand away from entities associated with such incidents. Entities with strong supply chain standards, monitoring and engagement with suppliers to address labour concerns may better preserve shareholder value over the long term.
    • Materials Sourcing & Efficiency The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
      • Raw Materials Sourcing The Apparel, Accessories & Footwear industry relies on many raw materials including cotton, leather, wool, rubber, and precious minerals and metals, as inputs for finished products. Sustainability impacts related to climate change, land use, resource scarcity and conflict in regions where the industry’s supply chain operates affect the industry’s ability to reliably source materials. The ability of entities to manage potential material shortages, supply disruptions, price volatility and reputational risks can be more difficult when supply chains lack transparency. Failure to effectively manage this issue can delay shipments and depress earnings, reduce margins, constrain revenue growth or increase costs of capital. The types of risk associated with sourcing different materials can require different solutions, including engaging with suppliers, enhancing transparency by using certification standards, using innovative alternative materials, or introducing circular economy practices. Entities that are proactive may reduce their exposure to price volatility and potential supply disruptions, while improving their brand reputation and developing new market opportunities.
  • Consumer Finance Remove
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    • Customer Privacy The category addresses management of risks related to the use of personally identifiable information (PII) and other customer or user data for secondary purposes including but not limited to marketing through affiliates and non-affiliates. The scope of the category includes social issues that may arise from a company’s approach to collecting data, obtaining consent (e.g., opt-in policies), managing user and customer expectations regarding how their data is used, and managing evolving regulation. It excludes social issues arising from cybersecurity risks, which are covered in a separate category.
      • Customer Privacy Entities in the Consumer Finance industry face risks and opportunities associated with using customer data for purposes other than those for which the data was originally collected (for example, targeted advertising or transfer to third parties). Ensuring the privacy of personal information and other account holders’ data is an essential responsibility of the Consumer Finance industry. To assess performance on this issue, investors may benefit from entities’ disclosure of the number of account holders whose information is used for secondary purposes, and their policies and procedures around using such information, including the nature of their opt-in policies. Investors may be encouraged and reassured by disclosures of information regarding an entity’s data usage, as well as applicable jurisdictional legal or regulatory actions related to customer protection and privacy. Entities in the Consumer Finance industry that fail to manage performance in this area may be susceptible to decreased revenues resulting from lost consumer confidence and high employee turnover, as well as financial consequences arising from increased legal risks.
    • Data Security The category addresses management of risks related to collection, retention, and use of sensitive, confidential, and/or proprietary customer or user data. It includes social issues that may arise from incidents such as data breaches in which personally identifiable information (PII) and other user or customer data may be exposed. It addresses a company’s strategy, policies, and practices related to IT infrastructure, staff training, record keeping, cooperation with law enforcement, and other mechanisms used to ensure security of customer or user data.
      • Data Security Entities in the Consumer Finance industry face risks and opportunities associated with customer data security management, in the context of external threats. Ensuring the security of customers’ personal information is an essential responsibility of the Consumer Finance industry. To assess performance on this issue, analysts may benefit from disclosure regarding safeguarding customer data against emerging and continuously evolving cybersecurity threats and technologies, security breaches compromising customers’ personal information, and credit and debit card fraud. Entities that fail to manage these threats effectively may be susceptible to reduced revenues resulting from decreased consumer confidence and high employee turnover. Furthermore, data breaches may expose entities to lengthy, costly litigation and potential monetary losses.
    • Product Quality & Safety The category addresses issues involving unintended characteristics of products sold or services provided that may create health or safety risks to end-users. It addresses a company’s ability to offer manufactured products and/or services that meet customer expectations with respect to their health and safety characteristics. It includes, but is not limited to, issues involving liability, management of recalls and market withdrawals, product testing, and chemicals/content/ingredient management in products.
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    • Selling Practices & Product Labeling The category addresses social issues that may arise from a failure to manage the transparency, accuracy, and comprehensibility of marketing statements, advertising, and labeling of products and services. It includes, but is not limited to, advertising standards and regulations, ethical and responsible marketing practices, misleading or deceptive labeling, as well as discriminatory or predatory selling and lending practices. This may include deceptive or aggressive selling practices in which incentive structures for employees could encourage the sale of products or services that are not in the best interest of customers or clients.
      • Selling Practices Selling practices encompasses performance in three important areas that can affect an entity’s operations and financial condition. First, entity compensation and incentive policies may unintentionally encourage the selling of products and services that are not in the clients’ best interest. Secondly, an entity may be perceived as using deceptive practices from a failure to provide transparent information to customers about primary and add-on products. And finally, depending on the characteristics of products offered, poor performance on the first two elements could result in customers holding portfolios containing high concentrations of risk. Entities in the Consumer Finance industry may face increased scrutiny as regulators encourage improved transparency and enhanced disclosure. The disclosure of important lending portfolio characteristics—including average fees from add-on products, average age of credit products, average annual percentage rate (APR) of credit products, average number of credit accounts and average annual fees for pre-paid transaction products—may permit shareholders to determine which entities can best protect long-term value, rather than relying on short-term revenue generation practices. Providing consumer finance products focused on the customers’ best interest may build trust with new and existing customers, expand market share, and ensure sustainable revenue growth.
    • Supply Chain Management The category addresses management of environmental, social, and governance (ESG) risks within a company’s supply chain. It addresses issues associated with environmental and social externalities created by suppliers through their operational activities. Such issues include, but are not limited to, environmental responsibility, human rights, labour practices, and ethics and corruption. Management may involve screening, selection, monitoring, and engagement with suppliers on their environmental and social impacts. The category does not address the impacts of external factors – such as climate change and other environmental and social factors – on suppliers’ operations and/or on the availability and pricing of key resources, which is covered in a separate category.
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    • Materials Sourcing & Efficiency The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
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Current Industries:
Apparel, Accessories & Footwear
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Consumer Finance
Consumer Goods
Financials
Extractives & Minerals Processing
Food & Beverage
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