March 13, 2012
Momentum Grows for Integrated Reporting
by Robert Kropp
With the Rio+20 Conference on Sustainable Development three months away, numerous voices speak out
on the need for governments to mandate sustainability reporting by large companies.
A report entitled Re
silient People, Resilient Planet: A Future Worth Choosing, issued by the UN High-level Panel on Global Sustainability in January, lists
among its 56 recommendations one that states, "Governments should promote and incentivize the
inclusion of long-term sustainable development criteria in investment and transactions conducted by
companies, including financial transactions."
In addition, the recently published Zero draft of the Future We
Want document by the United Nations
Conference on Sustainable Development (UNCSD) calls for "a global policy framework requiring
all listed and large private companies to consider sustainability issues and to integrate
sustainability information within the reporting cycle."
"Business groups should work with
Governments and international agencies to develop a framework for sustainable development
reporting, and should consider mandatory reporting by corporations with market capitalizations
larger than $100 million," the recommendation continues.
The draft document was published
in advance of the Rio+20 conference, to be held in Rio de Janeiro in June. The objective of the
conference, according to UNCSD, "is to secure renewed political commitment for sustainable
development, assess the progress to date and the remaining gaps in the implementation of the
outcomes of the major summits on sustainable development, and address new and emerging challenges."
The Corporate Sustainability Reporting
Coalition, a network of investors organized by Aviva Investors, has contributed its expectations for a
meaningful outcome to the conference as well.
"It is now almost twenty years since the
first Earth Summit," the Coalition states. "If a Sustainable Green Economy is to be reached, the
time has now come for sustainability reporting to become standard practice."
has called on governments "to develop a Convention that mandates company boards to consider
sustainability issues, and to integrate those issues that they consider to be material within the
reporting cycle, in their Annual Report and Accounts – or explain why if they do not."
a meeting held earlier this month, Steve Waygood, chief responsible investment
officer at Aviva, described the recommendations for integrated reporting by the High-level Panel on
Global Sustainability as "a huge step forward."
Waygood recommended that companies
required to report be expanded to include large unlisted companies. He also suggested that
companies observe a comply or explain provision by which the must explain to stakeholders why they
have not chosen to integrate sustainability into their reporting.
At the meeting, Craig
Bennett of Friends of the Earth took issue with the voluntary aspects of comply or explain.
"If anyone stood up and said companies should voluntarily report on financial matters, they
would be laughed out of the room," Bennett said. "So why not on their social and environmental
Waygood also noted that satisfactory frameworks for integrated reporting by
companies already exist, citing the Global Reporting Initiative (GRI) as an example.
GRI was instrumental in the 2010 formation of the International Integrated Reporting Committee (IIRC), and is a
member of the Corporate Sustainability Reporting Coalition as well. Its G4 Guidelines for
sustainability reporting will, GRI states, "provide companies with a stepping stone towards
integrated reporting and, in the context of the IIRC's framework, help users formulate content for
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