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This principles-based guidance will help the accountancy profession to facilitate sustainable organisations, financial markets and economies by taking into account economic, environmental and social considerations for project appraisal and investment decisions.
“The time was right to update the 2008 guidance to reinforce the importance of rigorous project and investment appraisal, with a specific emphasis on facilitating long-term decision-making and incorporating sustainability-related impacts”, said Roger Tabor, chair of the PAIB Committee. “The revised guidance also sets out the critical role professional accountants in business play in advising on the application of financial principles and theory that are being tested during this current period of market instability.”
More than half of all professional accountants in the world work in business and the public and not-for-profit sectors. They play a crucial role in helping organisations ensure a systematic and analytical approach to project and investment appraisal that incorporates wider external impacts by including relevant costs and benefits into the decision process. External impacts include social impacts, like health and safety and labour practices, the economic impacts of decisions, such as in communities and for suppliers, and environmental impacts, such as biodiversity and pollution.
“Through a better understanding of these wider impacts and externalities, an organisation and its stakeholders will have a more complete picture of sustainable value creation”, said Vittorio Lusvarghi, outgoing chair of the PAIB Committee’s Sustainability Task Force.