Lecture 3:

Reading & homework (short quiz next week)

Appendix 27
1. What does “comply or explain” mean? (p. 1)

According to Corporate Governance Code and Corporate Governance Report

(“Corporate Governance Code”) in Appendix 14 of the Main Board Listing Rules.

Comply: The Code sets out a number of “principles” followed by code provisions and

recommended best practices.

Explain: Where an issuer considers a more suitable alternative to a code provision exists, it

should adopt it and give reasons. However, the issuer must explain to its shareholders why

good corporate governance was achieved by means other than strict compliance with the code

provision.

2. What is the difference between “comply and explain” disclosures and

“recommended disclosures”? (p. 1)

The issuer is encouraged, but not required, to report on the recommended disclosures of this

Guide. However ““comply and explain” disclosures are mandatory.

3. How often should an issuer disclose ESG information? (p. 1)

An issuer must disclose ESG information on an annual basis and regarding the same period

covered in its annual report.

GRI
1. What do “materiality” (p. 10), “completeness” (p. 12), “accuracy (p. 13),
“balance” (p. 13), “comparability” (p. 14), and “reliability” (p. 15), and
“timeliness” (p. 16) mean?
 Materiality is the principle that determines which relevant topics are sufficiently important

that it is essential to report on them. Not all material topics are of equal importance, and the
emphasis within a report is expected to reflect their relative priority.

Completeness: The report shall include coverage of material topics and their
Boundaries, sufficient to reflect significant economic, environmental, and social impacts,

and to enable stakeholders to assess the reporting organization’s performance in the

reporting period.

Accuracy : The reported information shall be sufficiently accurate and detailed for

stakeholders to assess the reporting organization’s performance.

Balance : The reported information shall reflect positive and negative aspects of the

reporting organization’s performance to enable a reasoned assessment of overall

performance.

Comparability :The reporting organization shall select, compile, and report

information consistently. The reported information shall be presented in a manner that

enables stakeholders to analyze changes in the organization’s performance over time, and

that could support analysis relative to other organizations.

Reliability: The reporting organization shall gather, record, compile, analyze, and report

information and processes used in the preparation of the report in a way that they can be

subject to examination, and that establishes the quality and materiality of the information.

Timeliness: The reporting organization shall report on a regular schedule so that

information is available in time for stakeholders to make informed decisions.

2. How many disclosures are included in GRI 303 “Water & Effluents” and GRI
408 “Child Labour”?
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3. If you were a manager in a global company in London sourcing products from
Bangladesh, what information would you need to collect for GRI 408 so as to
be able to report accurately and reliably in your CSR/sustainability report?

Define child labor: The minimum age for hazardous work is 18 years for all countries.
Risk assessment:

What’s the job nature of the supplier and operation?

Is the job nature considered to have significant risk for child labor or young workers
exposed to hazardous work?

what kind of hazardous materials and working environment are involved.

What’s the geographic location of the operation being taken place?

Any potential risk associated with the location?

What are the measures taken by the organization to abolish child labor?

Any third party auditor to verify the measures taken to abolish child labor?