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Mortgage Finance
The Mortgage Finance industry provides an essential public good by enabling consumers to purchase homes and contributing to the overall home ownership rate. Entities in the industry lend capital to individual and commercial customers using property as collateral. The primary products are residential and commercial mortgages, while other services offered include mortgage servicing, title insurance, closing and settlement services, and valuation. In addition, mortgage finance entities own, manage and finance real estate-related investments such as mortgage pass-through certificates and collateralised mortgage obligations. Recent trends in the regulatory environment indicate a significant shift towards consumer protection, disclosure and accountability. Regulatory changes made in response to the global 2008 financial crisis demonstrate the potential for further alignment between the interests of society and those of long-term investors.
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Drug Retailers
Drug Retailers industry entities operate retail pharmacies and distribution centres that supply retail stores. Stores may be entity-owned or franchised. Large entities source drugs and other merchandise through wholesalers and distributors. Consumer sales of prescription and over-the-counter pharmaceutical products generate a majority of the industry’s revenue; other goods sold include household goods, personal care products and a limited selection of groceries. Additionally, the pharmacy retailer segment is expanding its health-focused services by offering clinics at various retail locations, which may add to the industry’s shifting sustainability landscape.
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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.

Environment
- GHG Emissions
- Air Quality
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
- Water & Wastewater Management
- Waste & Hazardous Materials Management
- Ecological Impacts
Social Capital
- Human Rights & Community Relations
- Customer Privacy
- 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.
- Access & Affordability
- 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.
- Customer Welfare
  The category addresses customer welfare concerns over issues including, but not limited to, health and nutrition of foods and beverages, antibiotic use in animal production, and management of controlled substances. The category addresses the company’s ability to provide consumers with manufactured products and services that are aligned with societal expectations. It does not include issues directly related to quality and safety malfunctions of manufactured products and services, but instead addresses qualities inherent to the design and delivery of products and services where customer welfare may be in question. The scope of the category also captures companies’ ability to prevent counterfeit products.
- 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.
Human Capital
- Labour Practices
- Employee Health & Safety
- Employee Engagement, Diversity & Inclusion
Business Model and Innovation
- Product Design & Lifecycle Management
- Business Model Resilience
- Supply Chain Management
- Materials Sourcing & Efficiency
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
Leadership and Governance
- Business Ethics
- Competitive Behaviour
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management
- Systemic Risk Management

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.

Mortgage Finance Remove
Access Standard
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
  
  None
- 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.
  
  None
- 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.
  
  None
- Customer Welfare
  The category addresses customer welfare concerns over issues including, but not limited to, health and nutrition of foods and beverages, antibiotic use in animal production, and management of controlled substances. The category addresses the company’s ability to provide consumers with manufactured products and services that are aligned with societal expectations. It does not include issues directly related to quality and safety malfunctions of manufactured products and services, but instead addresses qualities inherent to the design and delivery of products and services where customer welfare may be in question. The scope of the category also captures companies’ ability to prevent counterfeit products.
  
  None
- 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.
  - Lending Practices
    The approach mortgage finance entities take when incentivising employees and how they communicate with customers is important for more than one reason. First, the incentive structures and compensation policies of loan originators may unintentionally encourage them to promote lending products and services unsuitable for their clients. Second, a lack of transparency provided to customers with respect to primary and add-on products may impair an entity’s reputation and invite regulatory scrutiny and costly litigation. Finally, as a consequence, the resulting client portfolios may contain a high concentration of risky products sold. Also, laws and regulations restricting predatory lending may prohibit mortgage originators from receiving compensation tied to loan value and may require additional disclosures be provided to borrowers. Entities that develop transparent information, give fair advice to customers and clearly disclose their lending practices may assist shareholders in determining which entities better protect shareholder value.
  - Discriminatory Lending
    The Mortgage Finance industry aggregates data to determine loan terms and conditions including important provisions such as loan size, interest rate, up-front points or other fees. However, the complex process may result in intentional or unintentional discriminatory lending practices by the mortgage originator. Discriminatory lending may result in fines or settlements for violations of regulations, increased reputational risk, and negative financial performance because of loan mispricing. Disclosing internal processes to ensure non-discriminatory lending, disclosing the amount of mortgage lending categorised by minority status along with relevant financial characteristics, and disclosing the amount of monetary losses resulting from legal proceedings associated with violations of applicable laws and regulations may help investors assess entity performance. Entities in the Mortgage Finance industry may reduce the risk of discriminatory lending, including unintended discriminatory lending, by implementing strong processes, enforcing internal controls, and proactively monitoring their loan portfolio, among other techniques.
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
  - Environmental Risk to Mortgaged Properties
    An increase in the frequency of extreme weather events associated with climate change may have an adverse impact on the Mortgage Finance industry. Specifically, hurricanes, floods and other climate change-related events have the potential to result in missed payments and loan defaults, while also decreasing the value of underlying assets. Entities which incorporate climate-related risks into lending analysis may be better positioned to create value over the long-term.
Drug Retailers Remove
Access Standard
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
  - Energy Management in Retail
    Chain drug retailers operate thousands of locations that consume large quantities of energy. Electricity is used primarily for lighting and refrigeration. Many retail locations may operate 24 hours a day, thereby increasing energy demand. Operational energy efficiency and diversification among a range of energy supply sources may mitigate exposure to rising energy costs and limit an entity’s indirect greenhouse gas emissions.
- 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 & Privacy
    Drug Retailers, as distributors of prescription medication and operators of retail health clinics, access and manage protected health information. The legal obligation to safeguard customer information includes the proper handling of sensitive information by staff in pharmacies and clinics, as well as the safe storage of information on physical and electronic media. Cyber attacks may compromise health information stored electronically, along with customers’ financial and personal data. Drug retailers that prevent major data breaches, including point-of-sales breaches and cyber attacks, can preserve brand value, reduce contingent liabilities and maintain market share.
- 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.
  - Drug Supply Chain Integrity
    The Drug Retailers industry supply chain is long and complex, consisting of distribution networks between manufacturers and retailers. Ensuring the quality and safety of pharmaceutical and healthcare products is critical to preserving brand value. The industry faces risks associated with counterfeit drugs, and effective supply chain management is essential in mitigating these challenges. Drug Retailers that effectively manage their supply chains may avoid costs related to recalls, and such incidents may present significant risks to customers. The prevalence of store-brand products, which constitute a growing portion of sales, increases the importance of this issue.
- Customer Welfare
  The category addresses customer welfare concerns over issues including, but not limited to, health and nutrition of foods and beverages, antibiotic use in animal production, and management of controlled substances. The category addresses the company’s ability to provide consumers with manufactured products and services that are aligned with societal expectations. It does not include issues directly related to quality and safety malfunctions of manufactured products and services, but instead addresses qualities inherent to the design and delivery of products and services where customer welfare may be in question. The scope of the category also captures companies’ ability to prevent counterfeit products.
  - Management of Controlled Substances
    Drug Retailers are distributors and sellers of a wide variety of controlled substances. Within this industry, the high volume of drugs processed and dispensed, along with the extensive retail and distribution networks of larger entities, increase the risk of theft, loss and illegal drug dispensing. These actions may result in adverse social externalities, including public health consequences related to drug abuse and the illicit drug trade. Drug Retailers may participate in jurisdictional drug monitoring programmes to mitigate some of the social issues associated with dispensing controlled substances. Furthermore, regulatory enforcement may result in fines and licence suspensions. Strong internal management of controlled substances may mitigate these risks and protect shareholder value in the long term.
  - Patient Health Outcomes
    Drug Retailers and pharmacists play an important role in the health care system, since they provide patients with medications and are often the last health care professionals to interact with patients before medications are consumed. Drug Retailers may enhance patient outcomes by improving communication, avoiding dispensing errors and raising patients’ drug-adherence rates. Pharmacies may engage and educate patients regarding the importance of adhering to prescriptions, which provides beneficial outcomes for patients as well as for businesses. Entities that effectively manage these interactions while avoiding dispensing errors may better protect shareholder value.
- 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.
  
  None
- Physical Impacts of Climate Change
  The category addresses the company’s ability to manage risks and opportunities associated with direct exposure of its owned or controlled assets and operations to actual or potential physical impacts of climate change. It captures environmental and social issues that may arise from operational disruptions due to physical impacts of climate change. It further captures socio-economic issues resulting from companies failing to incorporate climate change consideration in products and services sold, such as insurance policies and mortgages. The category relates to the company’s ability to adapt to increased frequency and severity of extreme weather, shifting climate, sea level risk, and other expected physical impacts of climate change. Management may involve enhancing resiliency of physical assets and/or surrounding infrastructure as well as incorporation of climate change-related considerations into key business activities (e.g., mortgage and insurance underwriting, planning and development of real estate projects).
  
  None

General Issue Category

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Energy Management

Energy Management in Retail
Chain drug retailers operate thousands of locations that consume large quantities of energy. Electricity is used primarily for lighting and refrigeration. Many retail locations may operate 24 hours a day, thereby increasing energy demand. Operational energy efficiency and diversification among a range of energy supply sources may mitigate exposure to rising energy costs and limit an entity’s indirect greenhouse gas emissions.

Data Security

Data Security & Privacy
Drug Retailers, as distributors of prescription medication and operators of retail health clinics, access and manage protected health information. The legal obligation to safeguard customer information includes the proper handling of sensitive information by staff in pharmacies and clinics, as well as the safe storage of information on physical and electronic media. Cyber attacks may compromise health information stored electronically, along with customers’ financial and personal data. Drug retailers that prevent major data breaches, including point-of-sales breaches and cyber attacks, can preserve brand value, reduce contingent liabilities and maintain market share.

Product Quality & Safety

Drug Supply Chain Integrity
The Drug Retailers industry supply chain is long and complex, consisting of distribution networks between manufacturers and retailers. Ensuring the quality and safety of pharmaceutical and healthcare products is critical to preserving brand value. The industry faces risks associated with counterfeit drugs, and effective supply chain management is essential in mitigating these challenges. Drug Retailers that effectively manage their supply chains may avoid costs related to recalls, and such incidents may present significant risks to customers. The prevalence of store-brand products, which constitute a growing portion of sales, increases the importance of this issue.

Customer Welfare

Management of Controlled Substances
Drug Retailers are distributors and sellers of a wide variety of controlled substances. Within this industry, the high volume of drugs processed and dispensed, along with the extensive retail and distribution networks of larger entities, increase the risk of theft, loss and illegal drug dispensing. These actions may result in adverse social externalities, including public health consequences related to drug abuse and the illicit drug trade. Drug Retailers may participate in jurisdictional drug monitoring programmes to mitigate some of the social issues associated with dispensing controlled substances. Furthermore, regulatory enforcement may result in fines and licence suspensions. Strong internal management of controlled substances may mitigate these risks and protect shareholder value in the long term.
Patient Health Outcomes
Drug Retailers and pharmacists play an important role in the health care system, since they provide patients with medications and are often the last health care professionals to interact with patients before medications are consumed. Drug Retailers may enhance patient outcomes by improving communication, avoiding dispensing errors and raising patients’ drug-adherence rates. Pharmacies may engage and educate patients regarding the importance of adhering to prescriptions, which provides beneficial outcomes for patients as well as for businesses. Entities that effectively manage these interactions while avoiding dispensing errors may better protect shareholder value.

Selling Practices & Product Labeling

Lending Practices
The approach mortgage finance entities take when incentivising employees and how they communicate with customers is important for more than one reason. First, the incentive structures and compensation policies of loan originators may unintentionally encourage them to promote lending products and services unsuitable for their clients. Second, a lack of transparency provided to customers with respect to primary and add-on products may impair an entity’s reputation and invite regulatory scrutiny and costly litigation. Finally, as a consequence, the resulting client portfolios may contain a high concentration of risky products sold. Also, laws and regulations restricting predatory lending may prohibit mortgage originators from receiving compensation tied to loan value and may require additional disclosures be provided to borrowers. Entities that develop transparent information, give fair advice to customers and clearly disclose their lending practices may assist shareholders in determining which entities better protect shareholder value.
Discriminatory Lending
The Mortgage Finance industry aggregates data to determine loan terms and conditions including important provisions such as loan size, interest rate, up-front points or other fees. However, the complex process may result in intentional or unintentional discriminatory lending practices by the mortgage originator. Discriminatory lending may result in fines or settlements for violations of regulations, increased reputational risk, and negative financial performance because of loan mispricing. Disclosing internal processes to ensure non-discriminatory lending, disclosing the amount of mortgage lending categorised by minority status along with relevant financial characteristics, and disclosing the amount of monetary losses resulting from legal proceedings associated with violations of applicable laws and regulations may help investors assess entity performance. Entities in the Mortgage Finance industry may reduce the risk of discriminatory lending, including unintended discriminatory lending, by implementing strong processes, enforcing internal controls, and proactively monitoring their loan portfolio, among other techniques.

Physical Impacts of Climate Change

Environmental Risk to Mortgaged Properties
An increase in the frequency of extreme weather events associated with climate change may have an adverse impact on the Mortgage Finance industry. Specifically, hurricanes, floods and other climate change-related events have the potential to result in missed payments and loan defaults, while also decreasing the value of underlying assets. Entities which incorporate climate-related risks into lending analysis may be better positioned to create value over the long-term.

Relevant Issues for both Industries (6 of 26)

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