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The new rules will only apply to some 6,000 large undertakings across the EU with more than 500 employees. Under the proposal, these undertakings will have to include in their management report a non-financial statement with information on environmental matters, social and employee-related aspects, respect for human rights, anti-corruption and bribery issues, and diversity on boards of directors.
Helen Brand, Chief Executive of ACCA, says: "ACCA welcomes this endorsement that represents an essential move towards enhancing transparency and contributing to smart and sustainable growth. It is an important moment in creating long term competitiveness in Europe and restoring trust of investors and stakeholders. At the same time it needs to be ensured that the administrative burdens are kept to a minimum for public interest entities that would fall under the scope of the directive.
"Certain large undertakings will have to disclose the diversity policies with regard to age, gender, educational and professional background. ACCA strongly supports this requirement as it is one of our core values.
"Transparency drives sustainability. Non-financial and diversity information is critical for companies’ risk management and for their long term perspective. It is especially crucial to have modern European rules in the current economic situation. This is part of how we build sustainable economic governance."
Recent research from ACCA’s Understanding Investorsseries, which captured the views of the investor community, found that 93 per cent of investors expressed support for the concept of non-financial reporting in company information.
Helen Brand added: "Today’s investor is sophisticated and will often pay an interest in all of a company’s activities, not only its profits, but there are clearly business benefits too. ACCA research has shown finance chiefs also have a growing appetite for non-financial reporting. The EU's moves towards incorporating this initiative across the continent echoes that sentiment."
Press release (published on 25.3.14)
See also: EU takes step towards greater corporate transparency