Corporate responsibility A s the debate of integrated reporting gathers momentum, it has been encouraging to see that the number of companies reporting non-financial data has increased this year. This has been driven by the context within which business operates and by stakeholders putting additional pressure on companies to demonstrate the connections between financial and non-financial factors. There is increasing recognition by leading reporters of the need to demonstrate linkages between the company strategy, governance and financial performance, and the social, environmental and economic context within which it operates. Five-year trend analysis Quality of reporting Time • Once seen as a non-essential business element and a ‘nice-to-do’. What’s required? The requirements from the Companies Act 2006 relating to non-financial content state that: ‘the business review must, to the extent necessary for an understanding of the development, performance or position of the company’s business, include information about: environmental matters, the company’s employees, social and community issues, including information about any policies of the company in relation to those matters and the effectiveness of those policies’. In August 2010, the Prince of Wales’ Accounting for Sustainability Project and the Global Reporting Initiative (GRI) announced the formation of the International Integrated Reporting Committee (IIRC), whose remit is “to create a globally accepted framework for accounting for sustainability”. There has been huge support for the Committee since its inception and they are currently developing a framework for public consultation and proposals for integrated reporting to be put forward at the G20 Finance Ministers meetings in late 2011. • Legislation and voluntary guidance have driven the volume of information though quality has not always improved accordingly. Leading reporters: • Demonstrate how CR is embedded in the overall business strategy and how it is managed throughout the organisation. • Detail stakeholder engagement and materiality processes. • Clearly report on material issues, the policies for managing these and their effectiveness. www.blacksunplc.com © Black Sun Plc 2011 25