Developing an Action Plan for Integrated Reporting

Here’s a message for all CEOs, CFOs and Sustainability Managers: Integrated reporting of financial and sustainability performance is an idea whose time is coming.

There have been two major international meetings on integrated reporting in recent months, and Net Balance was represented at both of them.

Terence Jeyaretnam, Net Balance’s founder, was one of two Australian representatives at a Harvard Business School forum on ‘Developing an Action Plan for Integrated Reporting’, in October 2010.

The purpose of this forum was to develop a set of recommendations for the rapid and broad adoption of integrated reporting on a global basis. It was not about developing a framework for integrated reporting, but about designing a process by which such a framework would be developed and implemented.

This follows the establishment of an International Integrated Reporting Committee (IIRC) in August 2010 by Accounting for Sustainability and the Global Reporting Initiative (GRI). The IIRC’s role is to develop a framework for reporting financial, environmental, social and governance information in an integrated format.

The need for such a framework has become clear as sustainability reporting has developed in recent years: accounting standards were not designed to capture non-financial issues and don’t provide a sense of real risks and underlying issues.

The move towards integrated reporting gathered pace at the GRI conference on Sustainability and Transparency held in Amsterdam in May 2010. Dr Robyn Leeson, a Director of Net Balance and a member of the GRI’s global Stakeholder Council, took part.

The conference set a goal that a standard for integrated reporting should be defined, tested and adopted by 2020.

The Harvard Business School forum brought together 90 people from all over the world. Participants included representatives from companies, analysts and investors, regulators and standard setters, the accounting profession and Harvard academics.

The forum reached a series of recommendations which have been published as an e-book, which it is hoped will help accelerate its adoption by companies all over the world. Net Balance  contributed three articles to the e-book, based on our experience of writing and assuring sustainability reports for many companies and organisations over the past four years.

The Net Balance position is that:

• The development of an integrated reporting framework needs to recognise that integrated reporting will only be possible if it reflects the reporting organisation’s strategy.
• The involvement of key stakeholder groups such as business, government, civil society and experts in both non-financial and financial accounting will be critical if integrated reporting is going to be worthwhile to companies and their stakeholders.
• The GRI guidelines require further development.

Click here to read the full e-book in PDF format.

For more information about preparing for integrated reporting, please contact Robyn Leeson at robyn@netbalance.com