SASB LEVEL II: TERMS
Measures of Variability; Spread Answer - analyze how dispersed a data set it
(Standard Deviation, Mean absolute deviation (MAD); Minimum and maximum
variables). Help users determine whether or not to normalize the data and
improve analysis of widely dispersed data with effective normalization
Descriptive statistics - measures of central tendancy Answer - help analyze the
average of middle values of a dataset (Mean, Median, Mode)
mean absolute deviation Answer - the average distance between each data
value and the mean (quartiles, quintiles, deciles, percentiles)
Quantiles Answer - Divide the distribution into quantiles. Determining
threshholds for good, average, and poor performance in an industry
normal distribution Answer - A function that represents the distribution of
variables as a symmetrical bell-shaped graph.
-68 percent of values will fall within one standard
deviation of the mean
-95 percent will fall within two standard deviations
-99.7 percent will fall within three standard deviations.
outliers Answer - sometimes go away when normalize data (ie - by number of
cars sold of revenue) but other times exist for valid reasons and may continue
to exist after normalization. so, important to investigate why data falls outside
typical range
,Skewness Answer - a measure of the degree to which a distribution is
asymmetrical. how often values fall above/below average. curve shows a tail on
one side of the curve because more results are concentrated on one end of the
performance range
-left tail longer along x-axis = negatively skewed (in picture)
-right longer = positively skewed
-data on the long-tailed end may be company's that are better or worse
performance
-caused by:
-underlying financial or operational characteristics of companies (only a few
large players in industry and rest small players)
-industry-wide regulatory conditions; and/or
• data characteristics such as performance floors and ceilings
Factor's related to a company's operating environment Answer - -business
climate (competitive drivers, peer behavior, pricing power, technological
innovations, expectations of key stakeholders)
-economic climate (commodity prices; taxes, inflation, interest rates)
-regulatory climate (current regulation, future regulation, fines)
-operating locations (exposure to environmental changes, natural resources,
ecosystem changes)
Two main lenses to evaluate if sustainability topics within standards are
relevant Answer - 1) internal operating factors (company's main revenue
streams and inputs for value creating)
2)external operating context (business climate, regulatory climate etc)
Who are considered stakeholders Answer -
, Common Contextual Considerations by Sustainability Dimension Answer - -
Environment: - environmental regulation in operating areas and trends; climate
change trends and projections; environmental attributes of company
operations
-Social Capital: shifts in consumer safety, protection, or health regulations;
shifts in social preferences or consumer concerns; human rights and indigenous
peoples regulations
-Human Capital: changes in workforce size or composition; nature of
operations; employee health and safety regulations or standards
-business model & innovation: regulatory developments that could affect
demand for products; environmental and social regulations; sustainability
performance/functionality of existing products; developments in extended
producer-responsibility laws
-leadership & governance: competitive nature of a company's market;
developments in process safety regulation; changes in governance and financial
regulation; changes to supply chain standards or regulation
Sustainability Dimensions Answer - -Environmental
-Social Capital
-Human Capital
-Business Model & Innovation
-Leadership & Governance
Categories of financial impact associated with SASB sustainability issues
Answer - 1) Revenue and expenses (ex- demand; market share and long term
growth; operational efficiency and cost structure)
2)Assets and liabilities (ex - tangible and intangible assets and liabilities)
3)Cost of capital (Risk) - often impact other channels as well (ex - governance,
volatility, and risk factors)
Measures of Variability; Spread Answer - analyze how dispersed a data set it
(Standard Deviation, Mean absolute deviation (MAD); Minimum and maximum
variables). Help users determine whether or not to normalize the data and
improve analysis of widely dispersed data with effective normalization
Descriptive statistics - measures of central tendancy Answer - help analyze the
average of middle values of a dataset (Mean, Median, Mode)
mean absolute deviation Answer - the average distance between each data
value and the mean (quartiles, quintiles, deciles, percentiles)
Quantiles Answer - Divide the distribution into quantiles. Determining
threshholds for good, average, and poor performance in an industry
normal distribution Answer - A function that represents the distribution of
variables as a symmetrical bell-shaped graph.
-68 percent of values will fall within one standard
deviation of the mean
-95 percent will fall within two standard deviations
-99.7 percent will fall within three standard deviations.
outliers Answer - sometimes go away when normalize data (ie - by number of
cars sold of revenue) but other times exist for valid reasons and may continue
to exist after normalization. so, important to investigate why data falls outside
typical range
,Skewness Answer - a measure of the degree to which a distribution is
asymmetrical. how often values fall above/below average. curve shows a tail on
one side of the curve because more results are concentrated on one end of the
performance range
-left tail longer along x-axis = negatively skewed (in picture)
-right longer = positively skewed
-data on the long-tailed end may be company's that are better or worse
performance
-caused by:
-underlying financial or operational characteristics of companies (only a few
large players in industry and rest small players)
-industry-wide regulatory conditions; and/or
• data characteristics such as performance floors and ceilings
Factor's related to a company's operating environment Answer - -business
climate (competitive drivers, peer behavior, pricing power, technological
innovations, expectations of key stakeholders)
-economic climate (commodity prices; taxes, inflation, interest rates)
-regulatory climate (current regulation, future regulation, fines)
-operating locations (exposure to environmental changes, natural resources,
ecosystem changes)
Two main lenses to evaluate if sustainability topics within standards are
relevant Answer - 1) internal operating factors (company's main revenue
streams and inputs for value creating)
2)external operating context (business climate, regulatory climate etc)
Who are considered stakeholders Answer -
, Common Contextual Considerations by Sustainability Dimension Answer - -
Environment: - environmental regulation in operating areas and trends; climate
change trends and projections; environmental attributes of company
operations
-Social Capital: shifts in consumer safety, protection, or health regulations;
shifts in social preferences or consumer concerns; human rights and indigenous
peoples regulations
-Human Capital: changes in workforce size or composition; nature of
operations; employee health and safety regulations or standards
-business model & innovation: regulatory developments that could affect
demand for products; environmental and social regulations; sustainability
performance/functionality of existing products; developments in extended
producer-responsibility laws
-leadership & governance: competitive nature of a company's market;
developments in process safety regulation; changes in governance and financial
regulation; changes to supply chain standards or regulation
Sustainability Dimensions Answer - -Environmental
-Social Capital
-Human Capital
-Business Model & Innovation
-Leadership & Governance
Categories of financial impact associated with SASB sustainability issues
Answer - 1) Revenue and expenses (ex- demand; market share and long term
growth; operational efficiency and cost structure)
2)Assets and liabilities (ex - tangible and intangible assets and liabilities)
3)Cost of capital (Risk) - often impact other channels as well (ex - governance,
volatility, and risk factors)
