On 8 March, the
IFRS (International Financial Reporting Standards) Foundation Trustees updated on their
strategic direction to
strengthen financial corporate reporting, by taking account of the
financial opportunities and risks of sustainability impacts on
enterprise value creation. As a logical next step, today they have
announced the
establishment of a new working group, consisting of international initiatives focussed on investor interests and reporting on enterprise value creation.
Eric Hespenheide, GRI Chairman, said:
“GRI looks forward to collaborating with the IFRS working group and
helping make the important link with sustainability reporting, which
focuses on disclosing a company’s impact on the world.
As I set out in my response on 8 March,
recognizing investors’ needs for reporting that identifies the effects
on value creation, linked to social and environmental issues, is a step
in the right direction. However, companies need to be accountable to a
multiplicity of stakeholders. This is why financial reporting and
comprehensive sustainability reporting, as enabled by GRI, need to be on
an equal footing.
The case for multi-stakeholder reporting, which applies the principle
of double materiality, is clear. We will continue to work with IFRS,
the European Commission and others to support global changes that
fulfill these aims.”
Judy Kuszewski, Chair of the GRI Global Sustainability Standards Board (GSSB), added:
“GRI and the GSSB support a future in which sustainability reporting
is on an equal footing with financial reporting, introducing
connectivity between these two pillars to improve corporate reporting as
a whole. We believe it is essential to strengthen financial reporting
by enabling sustainability disclosures, in the context of enterprise
value creation, as a precondition for creating this link.
Therefore, we are supportive of this announcement by the IFRS
Foundation to strengthen and extend financial reporting, while we are
also delighted to be working with the EU to bring about their ambitions
for transforming corporate reporting by building the connectivity
between financial and sustainability reporting.
Sustainability reporting that reflects the impacts of a company’s
activities – alongside robust financial reporting on enterprise value
added – is essential to build trust in business, government and other
institutions as we face the immense environmental, social and economic
challenges ahead.”