Disclosure focus
This disclosure asks an organisation to explain how its business model and value chain are affected by sustainability-related matters, and how those matters may in turn affect the organisation’s ability to create, preserve or erode value over time. In practice, the report should help a reader understand the main ways these matters connect to the organisation’s activities, relationships, inputs, outputs and wider chain of operations.
The practical focus is breadth and relevance, not just a few headline examples. Organisations should consider the full scope of operations and value chain that matter to the business, rather than limiting the discussion to flagship sites or isolated projects. The aim is to show where the effects arise, how significant they are, and which parts of the business and value chain are most exposed.
This LRA educational guidance supports disclosure preparation. For the exact requirements, always refer to the official IFRS source.
Before you start
A quick mental checklist before you prepare this disclosure — tick each as you settle it.
Preparation
Key datapoints to prepare
＋ Show s1-32 sub-elements (LRA working checklist)
Identify which parts of the value chain are affected.
Set out the effects you expect to arise later.
Set out the effects already being felt now.
Explain where lending, investing, or similar funding exposure sits.
Show whether risk is concentrated in particular places, assets, or sites.
Show whether risk is concentrated in upstream or downstream parts of the chain.
How to prepare it
1Set the reporting boundary first: decide which parts of the value chain are in scope for this disclosure, and keep that scope consistent across the rest of the work.
2Define the categories you will use to describe exposure, using plain business labels for the six required items: affected value-chain segments; expected future effects; effects already happening; funding or investment exposure; concentration by place, asset or site; and concentration in upstream or downstream relationships.
3Gather support for each item from internal records and other source material, so every statement can be traced back to evidence rather than judgement alone.
4Prepare the final content in the form needed for reporting: write the narrative where explanation is needed, and compile any figures or structured fields where the information is quantitative or grouped.
5Record any exclusions, assumptions, reclassifications or changes in approach, so a reviewer can see what was left out, what moved, and why the presentation is not directly comparable without that context.
6Check the draft against the official source before sign-off, confirming that the scope, definitions, evidence and final wording still match the underlying requirement and that nothing material has been missed or overstated.
Request the data
Request the business and value-chain impact evidence
Translate the disclosure into an internal business question — then adapt it to your organisation's own language.
Which parts of our operating model, supply chain, customer chain, assets and funding arrangements are affected now, and where do we expect effects to show up next?
Use your own internal terms first, then map them to the reporting categories. For example, if your teams talk about product lines, sites, suppliers, customers, projects, portfolios or funding lines, ask for the evidence in those words and only translate into the reporting labels at the end. This is a possible LRA training template; adapt it to your organisation and check the source material before sign-off.
Weak request
Please provide the IFRS S1 business model and value chain effects evidence for disclosure ifrs-s1::s1-32, including affected value-chain segments, anticipated effects, current effects, financing or investment channel exposure, geographic / asset / facility concentration, and upstream / downstream concentration.
Why it fails: It uses framework language that many teams will not recognise, so the owner may not know which internal reports to pull. It also asks for the disclosure labels rather than the business facts the team already tracks, which makes it harder to respond quickly and accurately.
Better request
Please send the latest internal evidence for [business area] showing what parts of our operating chain are affected, what is happening now, what may change next, where funding or investment exposure sits, and where exposure is concentrated by country, site, asset, supplier or customer. Use your own team’s terms and attach the source file or dashboard.
Industry examples
Draft your disclosure
Notes that turn data into a disclosure
LRA training templates — adapt them to your organisation, and check the official source before sign-off.
Method note
Set out how the figures were built, including what each category means, which parts of the business and value chain were included, and the basis used to group exposures and effects.
Context note
Explain what the numbers indicate in practice, such as where the main exposure sits, which parts of the chain are most affected, and whether the issue is concentrated in particular places or funding routes.
Fluctuation statement
If the figures move materially, describe the main driver in plain terms, for example a change in where exposure sits, a shift between current and expected effects, or a new concentration in a specific region, asset, facility, or channel.
Content index entry
s1-32 Business model and value chain effects — [location / page] / [notes]
Download Centre
Preparation tools & forms
Professional preparation tools for s1-32 — free with an LRA Community membership. Register once (it's free) and every download unlocks, together with the Disclosure Library, templates and the LRA AI-assistant.
Free · Community members
Assurance readiness
For each claim, check the evidence
Evidence pack to prepare
Common reporting gaps
The information is presented without a date or as-at point.The scope or boundary of the statement is left undefined.Key terms are used inconsistently across the report.Material changes since the previous period are not disclosed.Assertions are made without supporting detail or a source record.Boilerplate is used that does not actually answer what is asked.
Common gaps
Mistakes to avoid when collecting the data
Wrong owner asked
People chase the sustainability team for operational impacts when the evidence sits with procurement, finance, operations, or the business unit that actually tracks the affected activities.
Framework language used too early
The request goes out in reporting jargon instead of the organisation’s own terms, so teams cannot map it to the systems and reports they already use.
Scope not pinned down
The data pull starts before the team agrees which parts of the business and which parts of the chain are in scope, so different contributors answer for different populations.
Wrong time basis
Collectors mix current-period records with forward-looking estimates or use a different cut-off date from the rest of the pack, which makes the numbers and narratives impossible to align.
Counting bases mixed
One team reports by site, another by contract, and another by customer relationship, so the same activity is counted on different bases and cannot be reconciled cleanly.
Source labels stripped out
Original system tags, report names, and file references are dropped during consolidation, leaving no way to trace each figure back to the underlying record.
Separate populations merged
Upstream and downstream data are rolled together, or financing-linked exposure is blended with operating impacts, so distinct groups that should stay separate are no longer visible.
Evidence trail incomplete
The pack contains the figures but not the supporting metadata, such as source date, owner, version, and extraction method, so reviewers cannot test where the data came from.
No sign-off record
Draft figures move on without a named reviewer and approval trail, so nobody can show who checked the inputs, what changed, or when the final set was cleared.
Where judgement is often needed
Set the group boundary after a deal closes
If a purchase or sale changes the businesses in scope during the period, explain which parts of the chain are included and use the same cut-off point consistently across the narrative and any supporting figures.
Choose one country definition and stick to it
Where local labels or legal definitions differ across markets, state the definition you used for each affected segment and explain any mapping or grouping so readers can compare like with like.
Decide how to treat near-boundary activities
For activities that sit just inside or just outside the reporting perimeter, explain the inclusion rule you applied and why those cases were grouped in or left out.
Align the timing basis for current and expected effects
If actual impacts are captured at one date and forward-looking effects at another, disclose the timing basis used for each and make clear how the two sets of information relate.
Separate measured amounts from estimates
When some effects are directly observed and others are modelled or inferred, label them clearly, explain the main assumptions, and show which parts are based on evidence versus judgement.
Use a consistent rounding approach
If you round counts, percentages, or monetary amounts, state the rounding rule and make sure the rounded figures still reconcile to the totals you present.
Aggregate sensitive location data carefully
Where site-level detail could identify people, suppliers, or assets, combine the information to a level that protects privacy and explain the aggregation basis used.
Handle mixed upstream and downstream links consistently
If one business line has both supplier-side and customer-side exposure, describe each side separately where possible and explain any combined presentation used to avoid double counting.
Explain how concentration measures were built
When you highlight geographic, asset, facility, financing, or investment concentration, set out the basis for the concentration view, including the population covered and any exclusions.
Show how affected segments were selected
If only some parts of the chain are materially affected, explain the selection rule, the segments included, and any material areas left out so the reader can see the scope of the analysis.
Examples
Illustrative examples
Synthetic, written by LRA — not from a company report, not text from any standard.
Illustrative (synthetic) example — Consumer electronics assembly
We describe where our supply chain and customer-facing activities are most exposed, and how that shows up now and may change later. - Around 62% of our current exposure sits in component sourcing and contract manufacturing, with the remainder in warehousing, retail distribution and after-sales service; by geography, 48% is linked to East Asia, 27% to Europe and 25% to North America. - Our lending and insurance cover is also concentrated: 71% of committed borrowing and 54% of insured asset value relate to two manufacturing sites and one logistics hub, while 58% of our supplier finance and receivables programmes are tied to downstream distributors. - At present, we are seeing longer lead times and higher freight costs in those same segments, and we expect further pressure on inventory availability and service levels if disruption persists.
This synthetic disclosure shows how to explain where exposure sits across the value chain, where it is concentrated by place and asset, and how current disruption differs from expected future effects.
Illustrative (synthetic) example — Food processing and cold-chain logistics
We focus on the parts of our business most exposed today and the areas where we expect the next shift in impact. - The main pressure is in farm-gate sourcing, chilled transport and wholesale delivery, which together account for 79% of our current operational exposure; the balance is in packaging and local storage. - Our assets are clustered: 66% of plant capacity is in one coastal region, 21% in a second region and 13% in a third, while 57% of our financed equipment and 49% of our working-capital facilities sit with three cold stores. - We are already seeing spoilage losses and intermittent route delays in the affected segments, and we expect more frequent service interruptions and higher replacement costs if weather-related disruption increases.
This synthetic disclosure demonstrates how to link present-day effects and likely future effects to the parts of the business, locations, assets and funding arrangements that are most exposed.
How companies report S1-32 in practice
Real reports where this topic is disclosed. These are report practice, not exact disclosure templates to copy.
Chunghwa Telecom Co., Ltd.
Telecommunication Services · Taiwan · 2025
Chunghwa Telecom Co., Ltd.'s 2025 Sustainability Report includes references to sustainability-related risks and opportunities and their linkage to financial performance and remuneration policies (p.2), as well as a description of current reporting period risks and expected financial impacts, particularly transition risks with medium to long-term impacts (p.23-24). The report also mentions sustainability-related metrics and targets for material risks and opportunities (p.9) and highlights specific risks such as cybersecurity incidents and data misuse leading to administrative penalties (p.15). However, the report does not provide quotable evidence regarding affected value chain segments, descriptions of current or anticipated effects, financing or investment channel exposure, geographic asset facility concentration, or upstream/downstream concentration.
SITC International Holdings Company Limited
Water Transportation · Hong Kong · 2025
SITC International Holdings Company Limited’s 2025 Environmental, Social and Governance Report provides a description of the anticipated effects of climate-related risks and opportunities on its business model and resource allocation (p.193). The report also includes related context on the current and anticipated effects of climate-related risks and opportunities on the entity’s business, though this is not clearly disclosed as a distinct datapoint (p.192). However, the report does not provide clear information on the description of current effects, geographic asset facility concentration, or upstream and downstream concentration, and the disclosure of financing or investment channel exposure remains unclear (p.197).
Hang Lung Properties Limited
Real Estate · Hong Kong · 2025
Hang Lung Properties Limited’s Sustainability Report 2025 includes a related context on the current and anticipated effects of sustainability-related risks and opportunities on the entity, notably on pages 215, 216, 217, and 225, with references to financial position, performance, and cash flow impacts (p.215, p.216, p.217, p.225). However, the report does not provide a clear, explicit disclosure of affected value chain segments, nor does it include specific descriptions of current or anticipated effects, financing or investment channel exposure, geographic asset facility concentration, or upstream/downstream concentration. These datapoints remain absent or unclear in the report.
✓ LRA AI Assistant · Human-in-the-loop
Ask Study Studio AI assistant about this disclosure
Get practical answers for your reporting context. Your first two answers are free — join LRA Community for free to continue without a limit.
TryHow do I prepare s1-32?What data do I need to collect?Where can I see a real-report example?What mistakes should I avoid?
2 free answers
Check your understanding
Scenarios to work through
A manufacturer buys most of its key inputs from two suppliers in one coastal region, and a severe storm has already delayed deliveries for three weeks. The finance team is also reviewing whether the same suppliers sit in a single credit line arrangement that could tighten if disruption continues.
QHow should the preparer decide what to explain about the parts of the supply chain that are exposed, and whether the present disruption belongs in the current-effects narrative or the expected-effects narrative?
Reveal model answer →Hide answer ↑First, identify the specific parts of the chain that are exposed, using plain business language rather than a broad label. Then separate what is happening now from what is likely later: the three-week delay is a present effect, while any further knock-on impact from continued disruption belongs in the expected-effects discussion. If the supplier concentration also creates a financing or investment exposure, that should be described separately and clearly linked to the same business risk.
Why this matters · Keep the present and the likely future effects distinct, and tie each one to the relevant part of the chain or funding link.
A retailer sources 70 of its 100 stores from one distribution hub, and a flood has closed that hub for ten days. Management expects temporary rerouting costs now, plus possible longer-term changes to stock availability if the site remains unavailable.
QWhat should the preparer include when describing the effect on the business model, and how should the location concentration be handled?
Reveal model answer →Hide answer ↑The preparer should explain that the concentration is at the hub level, because that is the point where the business is most exposed. The current narrative should cover the ten-day closure and the rerouting costs already being incurred, while the anticipated narrative should cover the possible stock and service impacts if the closure lasts longer. The location concentration should be stated as the reason the effect is more severe than it would be with a more spread-out network.
Why this matters · Show where the concentration sits, then explain how that concentration changes both the immediate and the likely later impact.
An asset manager has a lending portfolio where 40% of the book is secured against properties in one flood-prone city, and 15% is tied to one industrial sector that depends on a single export route. A climate event has not yet caused losses, but internal stress testing suggests higher default risk if transport disruption persists.
QHow should the preparer judge whether to describe this as a current effect, an expected effect, or both, and what concentration information belongs in the note?
Reveal model answer →Hide answer ↑Because no loss has happened yet, the main focus is the expected effect: explain the likely pressure on credit quality if the disruption continues. If there are already signs such as increased arrears, those would belong in the current-effect section. The note should also identify the geographic concentration in the flood-prone city and the sector concentration linked to the export route, because both help readers understand why the exposure is material.
Why this matters · Use current effects for what has already started, and expected effects for what is only likely to emerge.
A food producer has a major customer that accounts for 55 of 120 million in annual sales, and that customer has signalled it may switch to a lower-carbon product line within two years. The producer also relies on one packaging supplier for 80% of its cartons, and that supplier is in a region facing water stress.
QWhat should the preparer do to separate downstream concentration from upstream concentration, and how should the future customer shift be treated?
Reveal model answer →Hide answer ↑The customer dependency should be described as a downstream concentration, because the exposure sits after the producer in the chain. The carton supplier dependency should be described as an upstream concentration, because it sits before the producer. The possible move to a lower-carbon product line is an anticipated effect, so it should be explained as a likely future change in demand rather than as a present effect unless the switch has already started.
Why this matters · Name the direction of the dependency clearly, and place future business shifts in the expected-effects discussion unless they are already underway.
Framework references
Related framework references
How this disclosure maps across the major reporting frameworks.
IFRS / ISSB
s1-32
within IFRS S1: General Requirements for Disclosure of Sustainability-related Financial Information
Open official source →Related & explore
FAQ
Questions this page answers
For s1-32, what data do I need to gather before I start drafting the disclosure?+−
The page says to prepare six datapoints: value chain segments, expected effects, observed effects, funding channel exposure, location concentration and supply chain concentration. Use those as the starting checklist before you draft anything.
How do I use the step-by-step 'how to prepare' section for s1-32 in practice?+−
Use it as a working sequence for getting from raw information to a draft disclosure. The page is set up to help you define scope, collect the right inputs, and then turn them into report-ready content.
Who should own the s1-32 data collection and sign-off in my organisation?+−
The page is designed for sustainability/ESG managers, HR or data owners, and assurance reviewers, so ownership should sit with the people who can source, explain and evidence the datapoints. The practical aim is to assign clear responsibility for each input before drafting.
What evidence should I keep for s1-32 so the disclosure is assurance-ready?+−
The page includes an evidence pack with five items for assurance readiness, plus five assurance claims to verify using claim, risk and evidence. Keep the supporting material together so you can show how each datapoint was prepared and checked.
What are the five assurance claims on the s1-32 page and how do I use them?+−
The page says there are five claims to verify, each linked to a claim, risk and evidence. Use them as a review checklist to test whether the disclosure is supported and whether the evidence pack is complete.
What are the common reporting gaps or mistakes for s1-32 that I should avoid?+−
The page includes a list of common reporting gaps and mistakes, so it is meant to help you spot weak points before finalising the disclosure. Use that section as a pre-submission quality check against your draft and evidence pack.
How do I turn the s1-32 page into a draft disclosure quickly?+−
The page provides draft-output support, including visualisation ideas, narrative starters and a content-index line. That makes it easier to move from collected data to a first draft without starting from a blank page.
How should I use the synthetic illustrative example on s1-32 without copying it into my report?+−
Treat the example as a model for structure, level of detail and how the quantitative table is presented. It is synthetic and illustrative, so use it to shape your own wording and numbers, not as a template to reproduce.
Where can I find the workbook and printable card for s1-32, and what are they for?+−
The Download Centre includes a Prep & Assurance workbook in .xlsx format and a printable Library Card in .pdf format. They are there to help you organise preparation, evidence and drafting in a practical way.
Can I use the s1-32 page alongside ESRS 2 General Disclosures data?+−
Yes, the page says the closest ESRS correspondence is ESRS 2 (General Disclosures), so the data may be reusable across frameworks. That does not mean the requirements are identical, so check the other framework separately before relying on the same dataset.
More questions this page can help with
s1-32 disclosure checklist for value chain segments, expected effects, observed effects, funding channel exposure, location concentration and supply chain concentrationHow to prepare an s1-32 draft disclosure from the workbook and evidence packs1-32 assurance evidence pack what to includes1-32 common mistakes and reporting gaps to avoids1-32 narrative starters and content index line exampless1-32 visualisation ideas for a sustainability reports1-32 who should own the data and sign-offs1-32 how to collect data for location concentration and supply chain concentrations1-32 how to use the prep and assurance workbooks1-32 from company reports examples where the topic is discloseds1-32 ESRS 2 General Disclosures data reuses1-32 assurance claims claim risk evidence checklist
How this library is built
312 published reports indexed
63171 pages with page-level citations
247 practitioner guides
Free · LRA Community
Get your s1-32 tools — free
Your preparation tools are free for LRA Community members and students. Register once (it's free) and your download starts right away — plus the Disclosure Library, templates and the LRA AI-assistant.
✓
You're in — your download is starting
Your file is downloading now. Your Community Cabinet — with the Disclosure Library, templates and the LRA AI-assistant — is ready too.
Open your Cabinet →