International Integrated Reporting Committee IIRC

Transcription

1 International Integrated Reporting Committee IIRC WICI symposium 2010 Strategic Approach for Integrated Business Reporting in Knowledge Economy W I C I the world's business reporting network December 2, 2010 Waseda University

2 Paul Druckman Chairman, Executive Board - The Prince s Accounting for Sustainability Project (A4S) Co-chair, IIRC Working Group

3 "There was a time when we could say that there was either a complete lack of knowledge, or at least room for doubt, about the consequences for our planet of our actions. That time has gone. We now know all too clearly what we are actually doing and that we need to do something about it urgently. Better accounting must be part of that process. HRH The Prince of Wales 3

4 The world has never faced greater challenges and the decisions taken in tackling these issues need to be based on clear and comprehensive information; but, as The Prince of Wales has said, we are at present battling to meet 21 st century challenges with, at best, 20 th century decision making and reporting systems.

5 Integrated reporting framework live examples Market context Strategy American Electric Power Governance Aviva plc Risk China Light & Power Remuneration EDF Energy HSBC Holdings plc Novo Nordisk and others... Slide 5

6 Integrated Reporting focussing on the top slice Integrated reporting framework Provides the top level structure for the whole reporting pyramid Slide 6

7 IR Definition Integrated reporting is a holistic and integrated account of a company s strategy and its financial and non-financial performance.

8 Integrated reporting based on this definition must also adhere to the following principles Its focus is long term sustainability of the company It provides a strategic perspective It tells a coherent and connected story It focuses on material/relevant issues It accounts for the needs and concerns of stakeholders It is responsive and forward-looking It is balanced and comprehensive It drives change It provides a faithful representation: it is clear, complete, accurate, comparable, timely and neutral It is consistent with management information It is builds trust

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10 Why the IIRC was established Bring together financial standard setters (IASB, FASB, IFAC), securities regulators (IOSCO) and sustainability standard setters (GRI, AccountAbility) with representatives from companies, investors and civil society to develop and implement an integrated reporting model Facilitate convergence to increase consistency, avoid reporting burden and enable comparability on an international basis W I C I the world's business reporting network

11 The role of the IIRC raise awareness of this issue and develop a consensus among governments, listing authorities, business, investors, accounting bodies and standard setters for the best way to address it; develop an overarching integrated reporting framework setting out the scope of integrated reporting and its key components; identify priority areas where additional work is needed and provide a plan for development; consider whether standards in this area should be voluntary or mandatory and facilitate collaboration between standard-setters and convergence in the standards needed to underpin integrated reporting; and promote the adoption of integrated reporting by relevant regulators and report preparers. 11

12 IIRC Membership - extract

13 Jane Diplock, Chairperson, Executive Committee of the International Organization of Securities Commissions, said, I believe we will look back on the creation of this Committee as a turning point in the development of corporate reporting. Integrated Reporting builds on the practice of Financial Reporting, and Environmental, Social and Governance or ESG Reporting, and equips companies to strategically manage their operations, brand and reputation to stakeholders and be better prepared to manage any risk that may compromise the long-term sustainability of the business said Professor Mervyn King. Sir David Tweedie, Chairman of the International Accounting for Standards Board, said The case for globally consistent financial reporting standards is well understood and accepted. It is appropriate to apply the same global approach to other aspects of corporate reporting. This initiative represents an important step on that journey. Ian Ball, CEO of the International Federation of Accountants said The goal of the IIRC is not to increase the reporting burden on companies and other entities. Rather, it is to help them and all their stakeholders make better resource allocation decisions. All of us have a stake in a sustainable society. While integrated reporting alone cannot ensure sustainability it is a powerful mechanism to help us all make better decisions about the resources we consume and the lives we lead.

14 The Promoting Parties of WICI are: Enhanced Business Reporting Consortium, which was founded by American Institute of Certified Public Accountants, Grant Thornton LLP, Microsoft Corporation and PricewaterhouseCoopers European Federation of Financial Analysts Societies Japanese Ministry of Economy, Trade and Industry Organization for Economic Cooperation and Development Society for Knowledge Economics University of Ferrara Waseda University

15 IIRC Membership - extract

16 Key milestones Call for evidence Regional round-tables Discussion Paper Public consultation G20 proposals October 2010 March /April 2011 Late May 2011 Stakeholder Public consultation workshops ending 31 July 2011 November 2011 Meetings Jan 2011 May 2011 Sept IIRC Beijing New York São Paolo -Working group Oct 2010 Feb 2011 Aug 2011 Oct Pilots Mar 2011 Kick-off Pilots conducted June-July 2011 Ongoing engagement and consultation Newsletters ; Online integrated reporting community forum discussions ; Presentations at conferences, seminars and other meetings ; One-to-one meetings

17 Summary Work Plan Work-stream Description Output 1. Integrated Reporting Framework development 2. Engagement and communications Proposals for an integrated reporting framework Raise awareness of the need for integrated reporting and develop a consensus on the response required Discussion Paper for public consultation during June/July 2011 Support for proposals taken to the G20 in November Governance of Integrated Reporting Proposals for the role of the IIRC and other organisations to achieve the adoption and oversight of integrated reporting in the medium- to long-term Discussion Paper for public consultation during June/July

18 Next steps The development of a Discussion Paper setting out the scope and nature of integrated reporting, including a conceptual framework and the key principles that underpin it. (June 2011) To engage the G20 governments to support the work of the IIRC and to consider the implications for the reporting system and its future development. (November 2011). Slide 18