GRI Launches Effort to Marry CSR and Financial Reporting
In an effort to bring about the convergence of environmental, social, and corporate governance (ESG) reporting with financial reporting, the Global Reporting Initiative (GRI), along with the Prince's Accounting for Sustainability Project (A4S), announced this week the formation of the International Integrated Reporting Committee (IIRC).
At present, all publicly listed companies are required to file annual financial reports based on standardized reporting formats. "Increasingly," according to a press release[PDF] announcing the launch of the IIRC, "Companies are also producing, mostly on a voluntary basis, corporate social responsibility or sustainability reports but these can vary widely in terms of relevance and quality, largely because there is no global standard for measuring and reporting on environmental, social and governance performance."
The goal of the IIRC is to develop a globally accepted framework for integrated reporting, which will bring together ESG and financial reporting in a consistent and comparable format. Its intention is to provide comprehensive information about corporate performance that will meet the needs of a sustainable economic model, and support the information needs of long-term investors as well.
The IIRC initiative grew out of a paper published [PDF] in December 2009 by A4S, which observed, "A new, connected and integrated reporting model is needed, one that is capable of providing a more coherent, balanced and complete picture of performance…integrating both material financial and non-financial information."
The IIRC's Working Group is co-chaired by Paul Druckman, Executive Chairman of Trucost, and Ian Ball, Chief Executive Officer of the International Federation of Accountants. Of the 21 members of the working group, only Bob Laux, the Director of Accounting and Reporting at Microsoft, is based in the U.S.
Photo CC-licensed by Striatic.