How to Write an ESG Report: A Step-by-Step Guide for Australian Businesses

Writing a comprehensive, compliant ESG report is a significant undertaking—but one that follows a clear, structured process. Whether you’re preparing your first AASB S1 and S2 report for mandatory compliance or developing a voluntary sustainability report, this step-by-step guide will walk you through the entire process, from planning to publication.

For broader context on Australia’s sustainability reporting landscape, see our complete ESG guide.

Pre-Writing Phase: Foundation and Strategy (Months 1–3)

Step 1: Establish Your ESG Reporting Team

Before writing a single word, establish a cross-functional ESG reporting team with clear roles and responsibilities:

• ESG/Sustainability Manager or Director: Overall project lead, coordinate across departments, ensure timeline and quality
• Finance Lead: Ensure financial materiality assessment, link sustainability data to financial reporting
• Operations/Technical Leads: Responsible for data collection (emissions, water, waste, safety metrics, etc.) from relevant departments
• Communications/Content Lead: Write and edit disclosure statements, ensure clarity and consistency
• Governance/Compliance Lead: Ensure alignment with regulatory requirements, board reporting structures, policy alignment
• External Advisors: Consider engaging sustainability consultants or reporting specialists, particularly for first-time reporting

Step 2: Conduct or Update Your Materiality Assessment

Materiality assessment identifies which ESG topics matter most to your organisation and stakeholders. For AASB S1 and S2 compliance, this is mandatory and critical.

Process:

1. Environmental scan: Identify all potential ESG topics relevant to your industry and business
2. Stakeholder engagement: Consult employees, customers, investors, suppliers, and affected communities about priority topics
3. Internal assessment: Evaluate each topic’s significance to financial performance (financial materiality) and to people and environment (impact materiality)
4. Prioritisation matrix: Map topics on a materiality matrix (significance to business vs significance to stakeholders) to identify material topics requiring disclosure
5. Board sign-off: Board reviews and approves materiality assessment and material topics list

Document your materiality assessment thoroughly—AASB S1 requires disclosure of your methodology, stakeholders consulted, and resulting material topics.

Step 3: Decide on Report Scope, Boundary, and Format

Scope: What entities are included? Headquarters only, or all subsidiaries? Are joint ventures included? Define your consolidation boundary clearly.

Boundary: Temporal (which financial year?), geographic (global, Australia-only, specific regions?), and operational (owned/controlled only, or including suppliers and customers?).

Format options:

• Standalone sustainability report: Dedicated ESG report separate from annual report. Best for detailed stakeholder engagement and comprehensive disclosure
• Integrated report: Combined financial and sustainability reporting in one document. Shows connectivity between financial and sustainability performance
• Annual report inclusion: ESG disclosures incorporated into annual report Directors’ Report and notes. Common for ASX-listed companies
• Online disclosure: Website-based disclosure with downloadable reports. Emerging approach allowing interactive, modular presentation

Many organisations use a combination—core disclosures in the annual report, detailed sustainability report for stakeholder engagement, and online disclosures for investor portals.

Step 4: Review Applicable Standards and Frameworks

Understand which standards and frameworks you must or should follow:

• Mandatory: AASB S1 and S2 (if Group 1, 2, or 3 entity)
• Voluntary but increasingly expected: GRI Standards, TCFD, CDP, integrated reporting framework
• Industry-specific: GRI Sector Standards, industry association guidelines

Ensure your reporting structure addresses all mandatory requirements and voluntary frameworks relevant to your stakeholders.

Data Collection and Verification Phase (Months 2–6)

Step 5: Develop Data Collection Processes and Systems

Robust data systems are critical for AASB reporting. You will need:

• Data dictionary: Clearly define each metric (e.g., what counts as “Scope 1 emissions,” which facilities are included, calculation methodology)
• Data collection templates: Spreadsheets or systems (e.g., ESG software, internal data platforms) to capture metrics from relevant departments
• Ownership and accountability: Assign responsibility for data collection in each department (facilities for energy and water, HR for diversity metrics, etc.)
• Timelines and deadlines: Create calendar of when each data point must be submitted and consolidated
• Quality controls: Document how data accuracy is verified and who approves submission

Step 6: Collect Sustainability Metrics

Working with departments across your organisation, collect data for all material topics. Key metrics typically include:

Environmental: Greenhouse gas emissions (Scope 1, 2, 3), energy consumption, water use, waste generation, recycling rates, biodiversity impacts

Social: Workforce diversity, gender pay gap, employee turnover, safety incident rates, training hours, supply chain labour practices, community investment

Governance: Board composition, audit committee details, ethics and compliance mechanisms, remuneration structures, risk management processes

Step 7: Verify and Validate Data

Before locking in data for your report:

• Check completeness—all required metrics are submitted
• Verify accuracy—compare to source documents, prior years, industry benchmarks
• Identify outliers—investigate unusual increases or decreases
• Document assumptions and calculations—particularly for complex metrics like Scope 3 emissions
• Obtain sign-off from data owners that figures are accurate and complete

Disclosure Writing Phase (Months 5–8)

Step 8: Structure Your ESG Report

Standard ESG report structure for AASB S1/S2 compliance includes:

• Executive Summary/Message from Board/CEO: High-level overview of ESG strategy, key achievements, targets, and commitment
• About This Report: Scope, boundary, materiality assessment methodology, reporting frameworks
• Governance Section (AASB S1 requirement): Board composition and ESG oversight, management structures, policies, remuneration linkage
• Strategy Section (AASB S1 requirement): How ESG factors affect business strategy, competitive positioning, capital allocation
• Risk Management Section (AASB S1 requirement): How ESG risks are identified, assessed, managed, integrated into risk management framework
• Climate Section (AASB S2 requirement if material): Climate governance, strategy, scenario analysis, transition and physical risks
• Material Topic Sections: One section per material topic, each addressing: why material, management approach, policies, metrics, targets, performance, challenges
• Appendix/Tables: Detailed metrics, GRI content index, AASB S1/S2 cross-reference table, data limitations/methodology

Step 9: Draft Governance, Strategy, and Risk Management Disclosures (AASB S1 Core Requirements)

Governance Disclosure: Write sections addressing:

• Board composition—skills, experience, expertise in ESG matters
• Board committees responsible for ESG oversight (Audit, Risk, Remuneration, etc.)
• Management roles and reporting lines for ESG
• How ESG information flows to and from the board
• How remuneration is linked to ESG performance
• Relevant policies (Code of Conduct, sustainability policy, climate policy)

Strategy Disclosure: Write sections explaining:

• How material ESG factors affect your business model and competitive positioning
• Integration of ESG into strategic planning and capital allocation
• Transition strategies if applicable (e.g., renewable energy transition, supply chain decarbonisation)
• Opportunities arising from ESG action (market access, cost reduction, innovation)
• Potential financial impacts of material ESG risks and opportunities

Risk Management Disclosure: Write sections covering:

• How ESG risks are identified (internal assessment, stakeholder feedback, scenario analysis, industry benchmarking)
• Risk assessment methodology (quantitative models, qualitative assessment, frequency/severity matrices)
• Integration with enterprise risk management—how ESG risks sit within overall risk framework
• Management and mitigation strategies for identified material risks
• Monitoring and review of risk management effectiveness

Step 10: Draft Climate Disclosures (AASB S2 Requirement)

If climate is material (almost always is), draft sections covering:

• Governance: Climate-specific board oversight, expertise, management structures
• Strategy: Climate scenario analysis (1.5°C, 2°C, current policy scenarios), transition and physical risks, business model resilience, financial impacts
• Risk Management: Climate risk identification, assessment, integration, monitoring processes
• Metrics & Targets: Scope 1, 2 (mandatory), Scope 3 (if material) emissions; intensity metrics; progress toward targets; target specifications and timeframes

Step 11: Draft Material Topic Disclosures

For each material topic identified in your materiality assessment, draft sections covering:

• Topic overview: Why this topic matters to your business and stakeholders
• Management approach: Policies, governance, processes to manage this topic
• Performance metrics: Quantitative data showing current performance (e.g., “45% of workforce is female,” “Zero fatalities across all operations”)
• Targets and progress: Stated targets, baseline year, progress to date, trajectory
• Challenges and opportunities: Key challenges in this area, opportunities being pursued
• Future focus: Priorities for next reporting year

Step 12: Link Disclosures to Frameworks

As you draft, cross-reference which disclosure addresses which standard/framework requirement:

• Create a mapping table showing each AASB S1/S2 requirement and where it’s addressed in your report
• If reporting against GRI, create a GRI content index showing all GRI disclosures and page references
• Ensure every material topic has governance, strategy, risk management, and metrics coverage per AASB S1 structure

Review, Assurance, and Finalisation Phase (Months 7–9)

Step 13: Internal Review and Approvals

Before external assurance:

• ESG team review for completeness, accuracy, consistency
• Department heads review sections covering their areas for accuracy and appropriateness
• CFO/Finance review for financial materiality and alignment with financial statements
• Legal/Compliance review for regulatory alignment and risk management
• Board/Audit Committee review and approval before finalisation

Step 14: Engage External Assurance Provider

AASB S1 requires limited external assurance for Group 1 entities (and will for Groups 2 and 3 by their reporting dates). Even if not mandatory, assurance enhances credibility:

• Select assurance provider with APES 3000 qualification and sustainability reporting experience
• Brief provider on report scope, material topics, data sources
• Provide complete data trails and documentation to support all metrics
• Work with provider on any queries or refinements needed
• Obtain limited assurance opinion and include in final report

Step 15: Finalise and Format

Once assurance is complete and any feedback incorporated:

• Final copy edit for clarity, consistency, tone
• Create visual elements (charts, infographics) to communicate key data and themes
• Format for publication (PDF, web, print, or combination)
• Ensure accessibility (readable fonts, alt text for images, web accessibility standards)
• Create cross-reference tables and indices (GRI content index, AASB mapping, topic index)

Publication and Stakeholder Engagement Phase (Months 9–10)

Step 16: Publish Your Report

Lodge or publish your report by your regulatory deadline (90 days after financial year end). Options include:

• ASX lodgement (for ASX-listed companies)
• ASIC lodgement (for other regulated entities)
• Company website publication (homepage, investor relations, or dedicated sustainability page)
• Third-party platforms (GRI database, corporate sustainability indices)

Ensure accessibility—website hosting should allow easy download/viewing, and provide alternative formats if requested.

Step 17: Engage Stakeholders and Communicate

Publishing is not the end—active engagement maximises impact:

• Press release or media briefing highlighting key achievements and commitments
• Email to key stakeholders (investors, employees, customers, suppliers, community organisations) announcing publication
• Analyst briefings if applicable
• Social media communication about key ESG achievements
• Response to investor questions, analyst inquiries about disclosures

Continuous Improvement Phase (Year-Round)

Step 18: Monitor, Track, and Refine

After publication, ongoing activities support next year’s reporting:

• Monitor progress against stated targets and update board regularly
• Collect feedback from investors, stakeholders on disclosure quality and gaps
• Track emerging ESG issues and adjust materiality assessment if needed
• Strengthen data systems based on first-year experience
• Benchmark against peer reports and best practices
• Plan continuous improvements for next reporting cycle

Frequently Asked Questions

How long should an ESG report be?

Standalone reports typically range 30–80 pages depending on organisation size and disclosure depth. AASB S1/S2 and GRI have no page limits but require specific disclosures. Prioritise material topics and depth over volume.

Can we include forward-looking statements in our ESG report?

Yes, but use appropriate disclaimers about assumptions and uncertainty. Statements about future targets, strategy, and plans should be clearly identified as forward-looking.

What if we don’t have historical data for the first year?

Disclose this limitation. AASB S1 allows qualitative disclosures where quantitative data is unavailable. Use the first year to establish baseline data and systems for future years.

Should we include negative information in our report?

Yes. Candid discussion of challenges, incidents, and areas needing improvement enhances credibility. AASB S1 requires balanced disclosure without bias.

How do we balance brevity with AASB S1/S2 requirements?

Structure concisely but comprehensively. Use a main report (focused on material topics and key disclosures) plus appendices or online supplements for detailed data and methodology.

Can we get assurance for just part of our report?

Yes. Some organisations obtain full assurance on key metrics (emissions) and limited assurance on broader narrative. Clearly disclose what has been assured and to what standard.

Moving Forward with Your ESG Report

Writing an effective ESG report requires structured planning, cross-functional collaboration, robust data systems, and clear communication. The process is iterative—the first report establishes foundational practices, and subsequent years allow refinement based on experience, stakeholder feedback, and evolving standards.

Ready to develop your first or next ESG report? Book a Free ESG Strategy Session to plan your reporting approach and timeline.