The Role of Voluntary Reporting in an Era of Mandatory Reporting

Key Points

• As sustainability reporting becomes increasingly regulated, companies are reassessing the role and value of voluntary reporting.
• Mandatory reporting is changing what companies disclose, with greater emphasis on structured, controlled, comparable, and assurance-ready information. However, this does not make voluntary reporting obsolete. 
• BSR tackles key questions on today’s reporting trends. BSR members can also explore insights from a recent Future of Reporting workshop to learn how their peers are responding to the evolving reporting landscape.

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How do voluntary and mandatory reporting frameworks build on each other?

Mandatory reporting requirements were not developed from scratch; they draw heavily on concepts, metrics, and reporting structures established through voluntary standards and frameworks. For example, both the ESRS and IFRS S1 and S2 use the TCFD pillars as a foundation for reporting. ESRS builds on GRI expertise, and ISSB standards require companies to consider SASB industry guidance and introduce TNFD recommendations to nature-related disclosures practice statement.

Regulatory reporting is also shaping voluntary practice. Expectations around double materiality, audit-ready data and controls, value-chain visibility, and reporting beyond climate are becoming standard practice and influencing the evolution of voluntary disclosures. Companies are increasingly applying these expectations to their reporting practices while voluntary frameworks continue to provide methodologies and sector guidance, and help companies prepare for emerging topics that may become part of future reporting requirements.

Voluntary and mandatory reporting should therefore be viewed as mutually reinforcing components of a company’s reporting system.

Are companies still reporting in alignment with voluntary standards and frameworks?

Voluntary reporting remains firmly embedded in corporate reporting practice, even as mandatory requirements expand. A recent July poll during a Future of Reporting meeting showed that companies are continuing to prepare for both voluntary and mandatory reporting, as well as for a balance of both.

Member companies at a recent Future of Reporting session found that TCFD, GRI, and SASB remain the most used voluntary frameworks, demonstrating that companies continue to rely on established approaches alongside emerging regulatory standards.

What added value does voluntary reporting continue to provide?

Voluntary reporting enables companies to address information that may not be fully captured through mandatory disclosures. This includes sector-specific or entity-specific information, detailed case studies, impact stories, examples of implementation, and broader explanations of sustainability strategy and performance.

BSR’s analysis illustrates how companies leverage voluntary frameworks to report on issues that are not detailed under reporting regulations (e.g., cybersecurity, conflict minerals, AI, etc.)

Voluntary reporting is also linked to stakeholder-focused requests from ratings and rankings, customers, business partners, industry initiatives (e.g., Higg Index), and assessment platforms such as CDP, EcoVadis, and Higg. While mandatory reporting focuses increasingly on material, structured, and decision-useful information, voluntary reporting provides greater flexibility to tailor disclosures to specific audiences and purposes.

Moreover, as regulatory reporting connects to the materiality of sustainability issues, companies see voluntary reporting as necessary to report on non-material but strategic information.

How are companies balancing regulatory and voluntary reporting frameworks?

With the shift to regulatory reporting and ever-increasing nuanced disclosure requirements across countries, many companies are now prioritizing regulatory compliance, materiality, stakeholder relevance, consistency with financial data, and strategic value, with many moving away from storytelling.

To do so, voluntary frameworks and reporting often provide the technical foundation for data management and reporting processes (such as existing databases, governance structure, controls, and reporting experience). Voluntary reporting supports regulatory readiness, reduces the effort needed to transition to new obligations, and helps ensure that mandatory standards build on established and tested reporting practices.

As regulatory reporting raises the bar for robust and verified information, voluntary disclosures are retained where they support business or stakeholder needs, provide relevant context or differentiation, enhance mandatory information, add clarity, respond to information requests, avoid duplication, and are supportable under third-party assurance. Moreover, voluntary disclosures give companies space to go beyond standardized reporting requirements and highlight what is unique to their sustainability approach—for example, their priorities, commitments, progress, and response to emerging issues.

Interestingly, companies out of scope of reporting regulations have also signaled voluntarily aligning to some extent with ESRS and ISSB standards.

Which communication platforms are companies using to share voluntary sustainability information?

Companies are using a combination of channels, including corporate websites, sustainability reports, annual reports, data supplements, and targeted stakeholder communications, depending on the purpose and audience.

Future of Reporting members indicated that material and decision-useful information tends to sit within regulated corporate management reports. Core, decision-useful information should remain easily accessible. On the other hand, voluntary information such as case studies, stakeholder-specific content, and more detailed or frequently updated information is spread across multiple platforms, such as websites or supplementary reports.

Companies should, however, maintain a coherent corporate narrative and avoid fragmented disclosures. They must invest in clear cross-references, consistent definitions and data, and a well-structured reporting architecture to help stakeholders navigate information across channels.

Conclusion

Voluntary reporting is not being replaced by mandatory reporting; its role is becoming more focused and strategic. Companies that integrate both regulatory and voluntary disclosures can strengthen regulatory readiness, respond to broader stakeholder needs, and create a more coherent, credible, and decision-useful reporting system.