Fair, balanced and understandable

The non-financial statement should give fair consideration to favourable and unfavourable aspects, without bias in the assessment or presentation of information.

The non-financial statement should consider all available and reliable inputs and other evidence, taking into account the information needs of relevant stakeholders. Users of information should not be misled by material misstatements such as, for example, the omission of material information, or the undue selective disclosure of immaterial information.

The non-financial statement should reflect a significant effort to clearly distinguish facts from a company's view or interpretation of them.

Fair and accurate information may be enhanced by, for example, robust and reliable internal control and reporting systems; effective stakeholder engagement; independent external assurance; appropriate corporate governance arrangements (for instance, certain independent board members or a board committee entrusted with the responsibility over sustainability matters).

Understandability may be enhanced by using plain language and consistent terminology, avoiding boilerplate text and, where necessary, providing definitions for technical terms.

In order to increase understandability, material information is expected to be provided with appropriate context.

A company's performance may, for example, be presented with reference to its strategies and broader goals. Companies are expected to describe how non-financial issues relate to its long term strategy, principal risks and policies.

It may be relevant for a company to clearly explain, as appropriate, scope and boundaries of the information disclosed, in particular if certain information only concerns one or several segments of a company, or excludes specific segments.

Companies should also explain key internals of the information disclosed, for instance, measurement methods, underlying assumptions, sources, etc.

The non-financial statement is not merely about providing lists of key performance indicators (KPIs). In order to properly understand a company's development, performance, position and impact, both qualitative and quantitative information should be disclosed. While quantitative information may be an effective mean to report non-financial information (i.e.: KPIs, targets,...), qualitative information provides appropriate context and improves the overall usefulness and understandability of the non-financial information  disclosed. A combinaison of narrative reporting, quantitative information and visual presentation supports enhances communication effectiveness and transparency.

A company which discloses a KPI may enhance transparency by providing information on: its purpose and link to the company strategy; definitions and methodology; source, assumptions and limitations; scope of activities concerned; benchmarks; targets; trends; changes in methodologies (if any); qualitative explanations of past and foreseen performance.