CSR In Financial Services

Our paper on transparency reports for large language models has been accepted to AI Ethics and Society! We’ve also released transparency reports for 14 models. If you’ll be in San Jose on October 21, come see our talk on this work. These transparency reports can help with: 🗂️ data provenance ⚖️ auditing & accountability 🌱 measuring environmental impact 🛑 evaluations of risk and harm 🌍 understanding how models are used   Mandatory transparency reporting is among the most common AI policy proposals, but there are few guidelines available describing how companies should actually do it. In February, we released our paper, “Foundation Model Transparency Reports,” where we proposed a framework for transparency reporting based on existing transparency reporting practices in pharmaceuticals, finance, and social media. We drew on the 100 transparency indicators from the Foundation Model Transparency Index to make each line item in the report concrete. At the time, no company had released a transparency report for their top AI model, so in providing an example we had to build a chimera transparency report with best practices drawn from 10 different companies.   In May, we published v1.1 of the Foundation Model Transparency Index, which includes transparency reports for 14 models, including OpenAI’s GPT-4, Anthropic’s Claude 3, Google’s Gemini 1.0 Ultra, and Meta’s Llama 2. The transparency reports are available as spreadsheets on our GitHub and in an interactive format on our website. We worked with companies to encourage them to disclose additional information about their most powerful AI models and were fairly successful – companies shared more than 200 new pieces of information, including potentially sensitive information about data, compute, and deployments. 🔗 Links to these resources in comment below!   Thanks to my coauthors Rishi Bommasani, Shayne Longpre, Betty Xiong, Sayash Kapoor, Nestor Maslej, Arvind Narayanan, Percy Liang at Stanford Institute for Human-Centered Artificial Intelligence (HAI), MIT Media Lab, and Princeton Center for Information Technology Policy

Kevin Klyman: "📣📣 We just published the third annual Foundation Model Transparency Index! Our comprehensive study shows that AI companies have become less transparent in 2025. Some highlights from the paper: ➡️ Transparency on the decline: The average transparency score for AI companies declined from 58/100 in 2024 to 40/100 in 2025. xAI scores lower than any company we have ever assessed, releasing almost no information about its practices or its flagship model. ➡️ Companies withhold key information: Top tech companies release little or no information about the environmental impact of AI, whose data they use to build their systems, or whether the risk mitigations they put in place actually work. We definitively show that this information is not publicly available and that companies refuse to release it. ➡️ Companies share the capabilities of their models, but do not adequately evaluate risks. Just 4 of 13 companies comprehensively evaluated risks prior to release of their foundation model and report results upon release, and only IBM releases an externally reproducible risk evaluation. ➡️ Companies have changed their practices to release less information. In 2024, Meta and Mistral released technical reports alongside their flagship models (Llama 2 and Mistral 7B), but in 2025 neither released technical reports (for Llama 4 and Mistral Medium 3 respectively). As a result, Meta no longer discloses which risk mitigations it uses, quantitative evaluations of those risk mitigations, the amount and type of hardware it used to train its model, or prohibited model behaviors. ➡️ Our method: We break down transparency of AI companies into 100 indicators, develop concrete definitions and rubrics for those indicators, and send each company a transparency report template to fill out. This year 7 companies filled out the transparency report, and we independently assessed 6 other companies. We then worked with these companies to help them improve their disclosures, often resulting in companies disclosing new information to the public. You can read the full paper in the comments below! Thanks to the team behind the index - Alex Wan, Sayash Kapoor, Nestor Maslej, Shayne Longpre, Betty Xiong, Percy Liang, Rishi Bommasani! I'd also like to thank Stanford Institute for Human-Centered Artificial Intelligence (HAI) for supporting this work, Loredana Fattorini for making the visuals, and the Foundation Model Transparency Index board for their guidance Dr. Rumman Chowdhury, Daniel Ho, Arvind Narayanan, Danielle Allen and Daron Acemoglu. "

Excited that our methods piece on the state of hypothesis-testing research in International Business (IB) has just been published in the Journal of International Business Studies (JIBS). In 2017, the journal published an influential editorial that introduced guidelines to promote more transparency and rigor in the conducting and reporting of statistical analyses. The guidelines aimed to reduce common problems such as p-hacking (manipulating analyses to obtain significant results) and publication bias (favoring positive findings over null or negative ones). 🤔 My colleagues Jelena Cerar, Phillip C. Nell and I wondered how much the field has progressed since the guidelines were introduced. So we analyzed nearly 800 empirical articles published between 2012 and 2024 in two leading IB journals. The verdict? Our results show rather mixed progress. ➕ On the positive side, researchers are more transparent than before: the reporting of effect sizes, confidence intervals, and robustness checks has increased over time. ➖ However, this improvement is uneven and has slowed in recent years. Many studies still omit important details, such as how outliers are handled or the full results of robustness tests ➖ A more disconcerting finding is that there is little to no improvement in addressing deeper issues: Most published results continue to confirm researchers’ hypotheses, and there is ongoing evidence of p-hacking and publication bias. In some cases, these issues may even be getting worse, which suggests that better reporting alone has not solved underlying incentives that discourage the publication of null or negative findings. ✔️ Based on our results, we propose a three-pronged framework and practical steps for further improving research practices in IB, aiming to (1) improve transparency in reporting, (2) strengthen the evidence behind results, and—most critically—(3) encourage the reporting and investigation of null and negative findings. Here is the link to the Open Access article: https://lnkd.in/eHqpGYbJ The article also forms part of the JIBS collection on Quantitative Methodology in IB aimed at advancing quantitative methodology to improve theory and practice (see link in the comments 👇 ) A special thanks to Jelena for leading the effort! #InternationalBusiness #Rigor #Transparency #ResearchImpact

Great example of sustainability communication that doesn't really celebrate success but rather failure Oatly's latest sustainability report offers a great example of a board-level risk governance. Instead of sanitising results, they transparently disclosed a 15% increase in corporate climate footprint, 30% jump in packaging emissions, and 24% rise in ingredient emissions. It is understandable to prefer to communicate only reached goals but sometimes the process of implementing a sustainability agenda takes time and changes course. For companies across all industries, this approach demonstrates several critical governance principles that extend far beyond sustainability reporting. Regulatory preparedness: As disclosure requirements change globally businesses that establish transparent reporting cultures today protect their organisations from future compliance failures and penalties. Stakeholder trust management: Investors, customers, and employees value authenticity over perfection. Companies that acknowledge operational challenges while demonstrating systematic measurement build stronger long-term relationships than those that present unrealistic success narratives. Litigation risk mitigation: Recent settlements in greenwashing cases have reached hundreds of millions when public claims don’t align with internal data. Boards that insist on accurate disclosure protect shareholder value and personal director liability. Strategic decision-making: Honest sustainability data, including unfavorable trends, enables better resource allocation and strategic planning. Boards cannot provide effective oversight with incomplete or misleading information. Sustainability communication is not always about celebrating successes. The most effective reports directed at consumers or board oversight acknowledge that complex operational changes involve tradeoffs, unintended consequences, and sometimes temporary setbacks that require transparent explanation to stakeholders. Whether the topic is cybersecurity, supply chain resilience, or climate impact, health and safety, the governance principle remains consistent: transparent measurement following the science and honest disclosure protect long-term enterprise value. #board #governance #directorduties #riskoversight #esggovernance #esg #insights #corporategovernance #fudicialduties

A few days ago, many large online services (Meta, X, LinkedIn, TikTok...) published their latest systemic risk reports. But who is actually reading them?We are! Last October, during the Hack the DSA workshop, with 30 experts from all over Europe, we looked at the DSA's transparency reporting obligations and wondered: are these reports really helping us understand content moderation practices? 💁♀️ Drawing from the main findings of this workshop as well as its key takeaways, with Stefania Di Stefano, we illustrate in a Verfassungsblog post, why the DSA’s promise of transparency is not living up to its expectations. We explain that the DSA’s shortcomings in its implementation of transparency obligations primarily stems from the fact that VLOPSEs (Very Large Online Platforms and Search Engines) are prioritizing ceremonial aspects of reporting processes at the expense of the substance. This negatively affects the substantive assessment of the plethora of DSA reports, making it difficult to elucidating platforms’ practices. 4️⃣ To address these concerns, we offer 4 practical recommendations to improve DSA reporting, which revolve around 4 general themes: harmonization, archiving, accountability for political advertising, and collaborations. Many thanks to the editorial team at Verfassungsblog for hosting our reflections and for their generous feedback! 🔗 To read our full analysis: https://lnkd.in/eQ6yd-ES

𝗜𝗦𝗦𝗕 𝗥𝗲𝗽𝗼𝗿𝘁𝗶𝗻𝗴: 𝗧𝗵𝗲 𝗙𝗶𝗿𝘀𝘁 𝗪𝗮𝘃𝗲 𝗼𝗳 𝗚𝗹𝗼𝗯𝗮𝗹 𝗦𝘂𝘀𝘁𝗮𝗶𝗻𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗗𝗶𝘀𝗰𝗹𝗼𝘀𝘂𝗿𝗲 I found an insightful report titled “ISSB Reporting in its First Wave” by Robertsbridge , which examines how early adopters are implementing the International Sustainability Standards Board (ISSB) framework and what this means for the future of corporate sustainability disclosure. ♻️ 👥 For the sustainability and ESG community, this document is particularly valuable. It offers a first real glimpse into how companies are translating IFRS S1 and IFRS S2 from theory into practice integrating climate and sustainability risks directly into financial reporting. 𝗪𝗵𝗮𝘁 𝗰𝗮𝗻 𝘄𝗲 𝗹𝗲𝗮𝗿𝗻? The report makes it clear that sustainability reporting is entering a new phase. ESG disclosures are moving away from narrative reports toward decision-useful information for investors, aligning climate risk, governance, strategy and financial performance within a single reporting architecture. 𝗞𝗲𝘆 𝘁𝗮𝗸𝗲𝗮𝘄𝗮𝘆𝘀 1️⃣ ISSB is quickly becoming the global baseline for sustainability disclosure, especially for capital markets. 2️⃣ Climate reporting is central, with IFRS S2 requiring detailed disclosures on transition risks, physical risks and opportunities. 3️⃣ Governance and strategy are under closer scrutiny, requiring boards and management to demonstrate oversight of sustainability risks. 4️⃣ Data systems and internal controls matter. Companies are realising that credible ESG reporting requires the same rigour as financial reporting. 5️⃣ Integration is the ultimate goal, sustainability information must be connected to enterprise risk management, strategy and capital allocation. 𝗪𝗵𝗼 𝘄𝗶𝗹𝗹 𝗯𝗲𝗻𝗲𝗳𝗶𝘁 𝗳𝗿𝗼𝗺 𝘁𝗵𝗶𝘀? • Corporate leaders and CFOs preparing for ISSB-aligned reporting • ESG practitioners building robust disclosure systems • Investors seeking comparable sustainability information • Policymakers and regulators aligning national frameworks with global standards From a planetary health perspective, the significance is profound. Transparent, standardised sustainability disclosures are not just about reporting they are about aligning capital flows with climate stability and long-term environmental resilience. And that shift is already underway. #SustainableFinance #ISSB #IFRSS1 #IFRSS2 #SustainabilityReporting #planetaryhealth #planetaryboundaries #sustainability #ClimateAction #carbonfootprint #NetZero #ClimateEmergency #SDG #ESG #GHG #netzero

The transparency conversation has changed remarkably over the last year. Journals are introducing publication models that reward rigorous study design before results are known. Scientific societies are putting transparency at the center of their meetings. The incentives are beginning to align with the principles that produce more credible real-world evidence. That is good news for everyone who depends on real-world evidence. One of the most exciting developments comes from the adoption of Registered Reports in Nature journals. In this publishing model, the scientific question and study methods are peer reviewed before the results are known! If the methods are sound, the journal provides in-principle acceptance, meaning publication no longer depends on whether the results are positive, negative, or somewhere in between. This fundamentally changes the incentives for researchers and helps reduce publication bias while rewarding rigorous study design. Although Registered Reports originated in other scientific disciplines, they represent an exciting direction for health research more broadly. For real-world evidence studies, where thoughtful design and prespecified analyses with documented amendments are essential, this model aligns naturally with the principles we have been advocating. Another welcome development is the increasing willingness of journals to publish study protocols. For example, BMJ Open now provides a dedicated pathway for publishing protocols, giving investigators an opportunity to obtain peer review, improve their methods before results are generated, and create a permanent public record of what was planned before analyses begin. Together, these developments signal that transparency is increasingly becoming an expected part of scientific contribution. This year's Annual Meeting of the International Society for Pharmacoepidemiology (ISPE) provides another example of the building momentum for real-world evidence. ISPE’s Transparency & Reproducibility Initiative highlights practical actions that researchers can take today, including developing detailed protocols, preregistering studies, sharing analytic code and implementation details, and using transparency statements to communicate these efforts. The initiative celebrates researchers who are putting these practices into action and makes their effort visible throughout the meeting. Seeing transparency recognized publicly at a major international meeting is another encouraging sign that these practices are becoming part of mainstream pharmacoepidemiology. If you'll be attending ISPE this year, we hope you'll say hello. We'd love to hear what has worked well in your own transparency journey, what obstacles remain, and what topics you'd like RWERR to cover in future newsletters. Thank you for being part of this growing community. Every protocol shared, every preregistration completed, and every piece of code made available moves our field forward. We'll see you at ISPE.

UEFA released its Football Sustainability Reporting Playbook. For a long time, sport has been behind other industries in how it measures and reports sustainability performance. This starts to close that gap. The playbook requires organizations to define material topics, set baselines, track KPIs, and assign ownership. Without that, there is no clear view of ESG risk exposure or where opportunities sit across operations, infrastructure, and partnerships. In other industries, this level of transparency is already expected. Stakeholders assess how risks are managed, how performance evolves, and whether actions translate into measurable outcomes. Without consistent reporting, that assessment is not possible. Transparency becomes operational. What gets disclosed reflects how the organization actually performs. Energy use, emissions, community impact, resource allocation. Data replaces narrative. Standardization and accessibility are key. Common definitions and aligned frameworks allow performance to be compared across organizations. Clear and structured information makes it usable for decision-making, not just publication. UEFA is setting a baseline for football. A shared framework reduces fragmentation and accelerates the transition toward reporting as a standard practice across clubs, leagues, and federations. Some elements from the playbook: Reporting is positioned at the end of a structured process: governance, strategy, execution, measurement, and disclosure Materiality, including double materiality, determines what is tracked. Targets and KPIs require defined baselines, scopes, and methodologies. Progression toward quantified, comparable performance over time. Stronger data governance, moving toward structured and auditable systems. Important step forward. Well done to the UEFA team for putting structure behind this shift.

The Global Reporting Initiative (GRI) reviews 30 empirical research papers to examine whether sustainability reporting actually affects corporate financial performance. Around 73% of the studies find a positive relationship, especially for companies using GRI-based reporting, indicating that more transparent and structured ESG disclosure is associated with higher profitability and stronger market valuation. However, the strength of this relationship varies across industries, countries, and measurement methods. The financial benefits mainly come through three channels. First, better access to capital and stronger reputation, as investors tend to trust and favor companies with credible sustainability disclosures, leading to lower financing costs. Second, operational efficiency, because measuring and reporting sustainability performance helps companies reduce energy use, waste, and supply chain inefficiencies, improving profitability. Third, risk management and resilience, as firms with strong ESG disclosure are generally more stable and better prepared for regulatory, climate, and reputational risks, particularly in high-impact industries such as energy, mining, and manufacturing. At the same time, the study finds an "inverted U-shaped" relationship between sustainability reporting and financial performance. While higher-quality reporting initially creates value, excessive, costly, or superficial disclosure can eventually reduce company value by increasing costs and triggering investor skepticism. In short, sustainability reporting can create economic value, but only when it is material, credible, and integrated into business strategy, rather than used mainly for impression management or greenwashing. What do you think? Detail: https://lnkd.in/ggv8Jh6h

🌍 Exploring EFRAG's Implementation Guidance on Value Chains 🌍 I recently delved into the EFRAG IG 2: Value Chain Implementation Guidance, released in May 2024, which provides essential insights into navigating the European Sustainability Reporting Standards (ESRS) in the context of corporate sustainability. Key highlights include: 1. Comprehensive Scope: The guidance emphasizes that sustainability statements should encompass all material impacts, risks, and opportunities (IROs) related to both upstream and downstream value chains, moving beyond just the company's own operations. This broader perspective is crucial for a more accurate depiction of a company's sustainability footprint. 2. Materiality Assessment: It stresses the importance of identifying material IROs within the value chain, taking into account relationships beyond direct contracts. Companies must ensure their materiality assessments effectively capture the nuances of their entire value chain, allowing for a thorough understanding of potential impacts. 3. Policies and Targets: Organizations are required to disclose relevant policies, actions, and targets concerning their value chains. This transparency not only enhances accountability but also demonstrates a commitment to sustainable practices throughout the supply chain. 4. Estimation of Data: The guidance acknowledges challenges in data collection from value chain actors and encourages companies to make reasonable estimates when primary data is unavailable. This pragmatic approach supports firms in fulfilling their reporting obligations while acknowledging the complexities of global supply chains. 5. Transition Period: A transitional phase allows companies to gradually adapt to these reporting requirements, underscoring the EFRAG’s commitment to easing the implementation process for businesses, particularly small and medium-sized enterprises (SMEs). As we move towards a more sustainable future, this guidance will be vital for companies aiming to enhance their reporting practices and align with EU sustainability objectives. Understanding and integrating these insights will empower organizations to create more responsible and transparent value chains. Venu Borra Erik Valiquette, CCLP Chris Bunio Sami Bousri Chris Sunderman Bob Gravestijn #ESRS #SustainabilityReporting #ValueChain #EFRAG #CorporateResponsibility #SustainableBusiness