2013, a huge year for non-financial reporting
May 30, 2013
Four new propositions are driving business transparency to a next level. After issuing its first review of the sector for health care and the mandatory disclosures that they are pursuing there, the Sustainability Accounting Standards Board (SASB) has now proposed a set of sustainability accounting standards for the Financials sector. April 16 saw the launch of the Consultation Draft for the International Integrated Reporting Framework. Both of these proposals are currently welcoming feedback from stakeholders — respectively until upcoming 14 June and 15 July. Rodney Irwin, managing director Financial Capital at WBCSD, advises the business community to do so.
Welcoming feedback from stakeholders
Also on April 16, the European Commission adopted a Directive that will require certain large companies to disclose information on policies, risks and results as regards environmental matters, social and employee-related aspects, respect for human rights, anti-corruption and bribery issues, and diversity on the boards of directors. This Directive amends the Accounting Directives and, according to the E.C. “its objective is to increase EU companies’ transparency and performance on environmental and social matters, and, therefore, to contribute effectively to long-term economic growth and employment.” Last but not least, the Global Reporting Initiative has launched its fourth generation of Sustainability Reporting Guidelines, the G4. These provide companies with practical guidance on how and what to report.
The WBCSD is passionately in favor of good corporate reporting. “Integrated reporting is where business needs to go.” Today, businesses are still being valued by their discounted future cash flows. But Irwin sees that approximately 80 percent of the average businesses’ balance sheets are made up of intangible assets. “Those aren’t really being factored into the valuation and true performance of an organization.” Therefore these new initiatives which strive to integrate non-financial performance in the form of natural capital usage, dependency and output are extremely important. But, he stresses: “We want better reporting, not more reporting.” In the end, the purpose is to drive consistency across industries so businesses can calculate their performance in a consistent manner.
This video was taped at the 2013 Global Conference on Sustainability and Reporting hosted by the Global Reporting Initiative (GRI) in Amsterdam, May 22-24, 2013.
- The SASB proposal for sustainability accounting standards for the financials sector will be available for public review until 14 June, 2013.
- The Consultation Draft for the International Integrated Reporting Framework can be read and commented on by all stakeholders until 15 July, 2013.
- The E.U. Directive on disclosure of non-financial and diversity information
- Global Reporting Initiative’s G4 Guidelines.
with attribution (and link, if online) to www.tias.edu.
To be cited as: “2013, a huge year for non-financial reporting”, Ingrid Ramaan, www.tias.edu, May 30, 2013.