Assess record for 'Disclosure of Non-Financial Information by Companies'

Transcription

1 Page 1 of 7 Assess record for 'Disclosure of Non-Financial Information by Companies' Meta Informations Creation date Last update date User name null Case Number Invitation Ref. Status N Background Information For the purpose of analysis of this consultation you want to be identified as - single Please specify the user type -single User Investor/investor organisation Name(s) (of respondent and of your organisation / company) -open reply- Eumedion Country where your organisation / company is located -single NL - Nederland Please provide the name and location of parent company Your address Stichting Eumedion Gustav Mahlerplein MS AMSTERDAM Your address: -open reply- Marleen.janssengroesbeek@eumedion.nl Short description of the general activity of your organisation / company: Eumedion is a representative of the interests of institutional investors in the field of corporate governance and sustaina the objective of Eumedion to maintain and further develop good corporate governance on the basis of the responsibility institutional investors established in the Netherlands and to advance the acceptance of and compliance with generally a corporate governance standareds by listed companies and institutional investors in the Netherlands and Europe in partic Is your organisation registered in the Interest Representative Register? Yes If your organisation is not registered, you have the

2 Page 2 of 7 opportunity to register here before you submit your contribution. Responses from organisations not registered will be published separately from the registered organisations. -single Please specify the Register ID number in the Interest Representative Register -open reply- Can the Commission contact you if further details on the information you submitted is required? -single Publication: Do you object to publication of the personal data on the grounds that such publication would harm your legitimate interests? - multiple choices reply- (optional) Yes Questionnaire 1. How would you consider the current regime of disclosure of information applicable in your country? - single Sufficient In replying to this question, please provide information on what way current reporting provides useful information, and to what extent it is sufficiently tailored to the circumstances of the company. Please comment on whether you find information useful for the decision-making of a company.

3 Page 3 of 7 Eumedion supports the Dutch guideline RJ400 from the Dutch Accounting Standard Board and the soft push towards bet financial reporting by the Ministry of Economic Affairs, Agriculture and Innovation (EL&I) through the so called Transpar Benchmark. The RJ400 is based on the reporting guidelines of the Global Reporting Initiative and refers to international other agreements, for example the OECD Guidelines and agreements under the ILO. Although there is no official monito the RJ400, the Dutch Social Economic Council has voluntarily taken up the task to monitor the disclosure on internation There is no record yet of the performance under RJ400 because its starting year was The reporting performance o blue chip listed companies is good. Several firms (Philips, TNT, ING, Akzo Nobel) already have an integrated report, a b Eumedion would like to encourage. But there is certainly room for improvement. In its spearheads letter of 2011 Eumed more (i.e. social and environmental) information regarding the supply chain, daily operations and principa participants have a variety of interests but are interested in information because it is useful for the decis i process of a company and help mitigate risks in the long term. It gives the investors and the board a better insight into strategies and risks and more insight lowers the cost of capital. As we know from research done by the association of Du auditors, comparability and insight in progress through reporting in a regular basis gives investors and other stakeholder opportunity to distinguish between high and low risk investments. 2. Have you Yes evaluated the effects, and costs and benefits, of any current corporate disclosure of environmental and social information? - single Disclosure has become more and more a default position. By this we mean that disclosure on environmental, social and strategies and performance adds in a positive way to the company s reputation and brand. Companies risk being valued fail to report on material information issues. And disclosure of the ESG-policy offers the starting point for engagement policy of an investor. 3. If you think that the current regime of disclosure of information should be improve you suggest that this should be done? The current regime of information often focuses on giving a broad, positive view of the company in relatio environmental and social performance and philanthropy. Some firms also add some dilemmas or results of discussions w stakeholders. Currently, Key Performance Indicators KPIs) are mostly missed. If the current practice of principles and g could evolve in a more facts and figures based approach, non financial reporting could move to a higher level of KPIs in future. Most companies still provide separate financial and sustainability reports and nor create a clear picture of ESG p risk, strategy and remuneration. Eumedion thinks that integrated reporting will help in linking ESG-performance to stra and daily operations. But even if a company is not ready for integrated reporting Eumedion participants would apprecia discussion on risks and performance either in the annual report, the CSR report or on the website. 4. In your companies be disclose the following (check all relevant boxes): -multiple choices reply- (optional) Whether or not they have a CSR policy, and if they do, how they implement that policy and what th have been The principal business risks and opportunities arising from social and environmental issues, and how taken into account in company strategy. Key information regarding issues such as employee engagement (e.g.: employee training policy, equ diversity, etc.); customer satisfaction (e.g.: customer loyalty); public perception of the company (e stakeholder dialogue); environmental policies (e.g.: energy efficiency, waste reduction); and innova R&D expenditure). Other Other, please specify: -open reply- Social and environmental performance in relation to the supply chain. Supply chain disclosure is a focus point of the D u Economic Council. And Eumedion would like to see disclosure of significant incidents through a incidents list. Such a better insight in a company s performance and is a indicator for future risks. 5. In your Principles Key Performance Indicators (KPIs)

4 Page 4 of 7 opinion, for a EU measure on reporting of information to achieve materiality and comparability it should be based upon (check all relevant boxes): -multiple choices reply- (optional) 5a) In case you consider that Key Performance Indicators (KPIs) would be useful, would you think that they should be (check all relevant boxes): -multiple choices reply- General for all economic sectors Sector specific 5b) Please indicate which indicators you would consider to be the most relevant for all economic sectors: - (optional) Energy Efficiency, GHG-emmissions, Staff Turnover, Training & Qualification, Maturity Workforce, Litigation risks, Anti- Corruption, Innovation. Comparability is best served by KPIs, but materiality sometimes needs more than just facts and Disclosure on risk appetite, assessment of risks, supply chain information and a mission statement could e license to operate. Transparency on these issues can benefit from a more principle based approach. In addition, if the p reporting is to inform as many stakeholders as possible, than perhaps principle based disclosure would be if we take financial reporting as a starting point a combination of principles and KPIs is a good way of integrating financ financial reporting. But the development of key performance indicators for environmental, social and governance perfo just started. We think that the European Commission should actively encourage - not through legislation but for exampl governance code - companies to develop them with their stakeholders. KPIs should cover both general as sector specific we want to see whether companies make an progess in the first place. General KPI s could be a good starting point for f have just started with reporting. But companies that already have an established tradition of CSR reporting should push than the general KPIs but should take the challenge of more sector specific KPIs as long as they really are related to wh (materiality) for strategy, risk and operations of the company. To give an indication of a starting point of KPIs we sugge 6. In your opinion, what should be the process to identify relevant principles and/or indicators (wh general or sector-specific)? In replying to this question, please comment on whether the Commission should endorse or make refere existing international frameworks (or a part of them), such as Global Reporting Initiative (GRI), UN Glob Compact, the OECD Guidelines, ISO 26000, or other frameworks; or whether companies should be requi select relevant indicators together with their investors and other stakeholders and to disclose informati according to such indicators, depending on the use that different stakeholders would make of such info All the frameworks mentioned are a good starting point for reporting. There is not one Eumedion would p others. Eumedion discourages the use of ISO26000 because it puts a heavy administrative burden on the companies invo guidelines should promote, in their guidance, more factual information and necessary figures that can be used to bench compare companies with other companies, or assess their performance on historical trends. The current r practice is more based on story telling and less on facts and figures. If we strive towards the same quality of non-financ as financial reporting, we would expect the board to tell the story and the figures and facts show the ESG performance 7. In your Yes companies be disclose the

5 Page 5 of 7 steps they take to fulfill the corporate responsibility to respect human rights? -single We are not in favour of legal requirements, but we would like companies to disclose their responsibility towards huma n Encouragement could be through a voluntary code. Human rights are an important issue in relation to the supply chain general company operations. As more and more companies move their production to countries where people are willing under more difficult and less sophisticated circumstances, firms should be accountable how they deal with different att towards labour and labour rights. The new human rights framework for business, developed by John Ruggie asked by the General of the United Nations, is a good starting point for companies on how to deal with and report on human rights is 8. In your Yes companies be disclose the risks they face and the policies they have in the field of corruption and bribery? -single We are not in favour of legal requirements, but we would like companies to disclose their responsibility towards huma n Encouragement could be through a voluntary code. The United States have strict laws regarding corruption and bribery business with certain countries. The Security and Exchange Commission (SEC) is preparing to be even stricter on disclos and oil companies and mining sector on their payments (tax, royalties, fees, production rights) under the Dodd-Frank Ac Multinationals should be very careful in their operations regarding these laws. Although the European Union or some of states have a more principle based attitude concerning legislation on corruption and bribery, companies already have th codes of conduct and report on incidents surrounding corruption and bribery. Some companies are very reluctant to be these incidents. But if it comes to court it will be in the public domain anyway. Management boards often express in pu commitment to ban corruption. It is in their interest to be accountable on this topic and show their suppliers and custo code of conducts. The codes are usually found on the websites of the firms. Eumedion would also recommend to ask for on anti-competitive behaviour. 9. In your All listed companies (Small, Medium & Large) opinion, what companies should be disclose nonfinancial information (check only one box)? -single 10. In your institutional investors be subject to specific or additional disclosure requirements, for example to disclose whether and No

6 Page 6 of 7 how they take into account environmental and social issues in their investment decisions? -single In replying to this question, please provide information on which issues seem to be the most relevant an and which institutional investors should be subject to such an obligation. Eumedion s no does not mean we are not in favour of disclosure. But we would rather not start with requirements i.c. l Eumedion has a good experience with the use of voluntary codes and we would recommend that if the European Commi to promote non financial disclosure she would start with a code of conduct for listed companies. A large proportion of t institutional investors is already committed to the UNPRI, the responsible investment initiative of the United Nations. T subscriptions institutional investors have to explain what their responsible investment policy is. In the Netherlands pen s and charity funds have been exposed to social scrutiny and outrage for their investment policy, i.e. because of their inv controversial weapon manufacturers and companies that employ children or have suppliers that use child labour. It is in of the institutional investors to disclose their investment policy in general terms which the large parties already do. To level playing field, it would be recommendable to ask all institutional investors to disclose their investment criteria and investment policy in not too much detail. The specific details can be disclosed to (potential) clients of the asset manag company or pension fund. 11. In your opinion, should European policy promote the concept of "integrated reporting"? No Integrated reporting refers to a report that integrates the company's key financial and information to show the relationship between financial and performance (environmental, social, and governance). -single In replying to this question, please indicate the advantages and disadvantages of an integrated report, possible specific costs of integrated reporting. If done poorly, the disadvantage could be that an integrated annual report would become unreadable because of all the information. However, a truly integrated report would avoid that and only reflect the essential information and focus o interlinkages providing a much better understanding of the company s potential long term success. The advantage of in reporting is that ESG management will be part of an integrated business strategy, which in the long term makes the com stronger. It gives the investors and other stakeholders more insight into different (financial and non financial) risks rela

7 Page 7 of 7 sector and the individual company. Some risks have potentially financial consequences and therefore it is that environmental, social and governance performance are related to daily operations and daily decisions. But we wou strong push towards integrated reporting because of the differences in reporting between for example the United State Europe. Some European Companies with a listing in the US have different reporting requirements (i.e. SEC 20-F). We wo leave the choice to the companies whether their decision is based on practical or legal considerations. 12. In your No disclosed nonfinancial information be audited by external auditors? -single In replying to this question please provide any evidence you may have regarding costs of auditing non-fi information, as well as your views on other possible forms of independent reviews besides external aud Eumedion s no does not mean we are not in favour of an independent audit. But we do not want the auditing to be limi professional auditors. In our experience other independent assurance providers also offer a high standard of verifying th non financial information. As long as the audit is an independent audit. Good reporting can help a compan better decisions if the board of directors also understand the importance of reporting, as the audit comm board is responsible for the appointment of the auditor. In addition if we want to encourage integrated reporting an au necessary to keep up the standards of the whole report. 13. If you have I attach additional documents relevant documents you want to share with us, please attach them here. (optional) -multiple choices reply- (optional) Uploaded files: _RJ_Uiting_2009_8_Herziene_Richtlijn_400_Jaarverslag_en_Ha [1].pdf PRINT EXPORT RECORD