Comments from ACCA to the Global Reporting Initiative, November 2011.
ACCA is pleased to comment on the first public consultation in the development process of the G4 Sustainability Reporting Guidelines. Our responses to this consultation only cover the areas of the online survey relevant to ACCA.
Q7. In general, what do you personally, consider to be the primary reasons for sustainability reporting?
ACCA consider the following to be primary reasons for sustainability reporting:
Transparency: Greater transparency can play a role in restoring trust in business and will allow stakeholders to make better informed decisions.
Responsibility: Companies have a responsibility to their stakeholders to address the various impacts of the organisation's activities. This should be clearly communicated through company reports (be they sustainability reports or integrated reports).
Accountability: Sustainability reporting increases the accountability of an organisation, which in turn increases trust levels.
Risk mitigation: Sustainability reporting requires an organisation to address a broader set of risks than traditional financial reporting. As a result, the organisation is better able to pick up on potential shocks before they become problematic.
Increased responsiveness to stakeholder needs: The process of sustainability reporting should involve a degree of stakeholder engagement. By listening the concerns of the various stakeholders in an organisation, the firm is better able to behave in a manner that will be to the benefit of its stakeholders.
Q8. Please pick the most important reasons your organisation produces its sustainability report. [Max. 5 answers]
The following four reasons were selected:
Considering the nature of ACCA's activity, the four reasons included above were considered most important to ACCA as a professional body.
Q9. Which of the following sustainability reporting formats are most relevant to your organisation today? Which do you expect to be the most relevant in three years? A decade from now? [Max. 3 answers per period]
Today: Regulatory filing (financial statements), sustainability report (CSR report), other stakeholder-specific report (annual review).
3 years time: Regulatory filing (financial statements), sustainability report (CSR report), other stakeholder-specific report (annual review), integrated report (combining financial statements and CSR report
10 years time: Regulatory filing (financial statements), sustainability report (CSR report), other stakeholder-specific report (annual review), integrated report (combining financial statements and web-based disclosures (supporting documents behind the integrated report).
Q10. GRI's goal is to create a platform to mainstream sustainability reporting practices. In order to make sustainability reporting a common practice, it is important to understand what information should be provided at a minimum. Please indicate the importance of the following elements for a sustainability report.
The following elements have been considered essential:
|Overview of the operational structure and regional presence||Key to understanding the business and the range of potential issues affecting the organisation.|
|Overview of the organisation's sustainability strategy||Necessary in order to understand how the organisation is performing against strategy.|
|Description of the organisation's governance approach, including senior management's responsibilities for sustainability performance||Key to understanding how well managed the organisation is. Able to determine the ‘tone at the top' through review of governance approach.|
|Results of stakeholder engagement||Important when looking to understand how well organisation is performing against what matters to stakeholders.|
|Identification of the entities (e.g., subsidiaries, joint ventures, sub-contractors) covered by the report||Key to understanding the scope of the report.|
|Description of material impacts||Necessary when looking to understand how well the organisation is addressing material impacts and managing the risks associated with those impacts.|
|Description of the organisation's value chain, covering the life-cycle of products/services and key inputs, outputs and participants||Key to understanding the scope of the report.|
|Description of material risks and opportunities||As per description of material impacts.|
|Indicators related to material topics||Allows the user to quantify how well the organisation is addressing material impacts, opportunities and risks.|
|Goals related to material topics||Allows the user to track progress over time.
|Description of groups or individuals either affected by the organisation's activities or able to affect the organisation's activities||Informs the user about the relevant stakeholders of an organisation.|
The following elements have been considered useful:
|Description of the organisation's stakeholder engagement approach||Support behind results of the stakeholder engagement - include as appendix.|
|Description of the process taken to determine topics to be included in the report||Support behind description of material issues - include as appendix.
|Description of the process taken to analyse the economic, environmental and social impacts of operational activities||As above.|
|Description of the process taken to analyse economic, environmental and social risks and opportunities resulting from operational activities||As above.|
|Description of the organisation's approach for managing material topics||Allows the user to understand how well management are addressing risks / taking advantage of opportunities.|
Q11. Is there other information that a sustainability report should include at a minimum?
The report should link the organisation's sustainability strategy to its overall strategy and include financial KPIs.
Q12. Topics are subject matters on which an organisation may report, such as market presence, emissions, child labour, product and service labelling, etc... Would you say topics to be covered in a sustainability report should be defined by:
An external body, such as GRI, based on international, multi-stakeholder consultation.
Q13. If an external body, such as GRI, based on international, multi-stakeholder consultation, should define, a set of topics that cover the key economic, environmental and social performance and impacts of organisations, and require reporting on these topics, would you say these topics should be:
A standard set of topics per sector.
Q14A. Could you indicate why you think this should be [Choice from Q13]?
Such an approach would allow for sector specific impacts to be addressed, which would be a more tailored approach than having a standard set of topics for all organisations.
Saying that, there will be a number of issues that are material to all organisations, so these should be included as a subset of the sector topics.
Q16. Should an external body, such as GRI, based on international, multi-stakeholder consultation, define a standard set of indicators that capture the key economic, environmental and social performance and impacts of organisations, and require reporting on these indicators?
Q17. Would you say these indicators should be?
A standard set of indicators per sector - in line with the standard set of topics per sector.
Q18A. Could you indicate why you think this should be [Q17]?
Such an approach would allow for sector specific impacts to be addressed, which would be a more tailored approach than having a standard set of indicators for all organisations.
Q20. Would you say GRI's Guidelines should offer guidance on how the sustainability reporting process or sustainability report content can be used to produce an Integrated Report?
Yes - very supportive of this proposal.
Q22. In May and June 2011, GRI invited the public to submit topics that it thought should be added to G4 and researched emerging trends in the sustainable development discussions. Below is a list of 12 topics that received broad support.
The survey has requested that 5 key topics should be selected. The ACCA sustainability team considers the following 7 to be of particular importance:
Biodiversity. Revision to reflect recent international work in this field, including ecosystem services.
Business Ethics. Implementation and promotion of ethical business practices.
Greenhouse Gas Emissions. Alignment with other international emissions reporting frameworks.
High Impact Event Management and Preparedness. Consideration of emergencies such as natural disasters and product recalls.
Life Cycle Assessment (LCA). Implementation of LCA methodology into processes, products and services.
Remuneration and performance-based pay. Explores the link between compensation systems and sustainability objectives, difference between the organisations highest and lowest income levels.
Water. Revision to include regional basin or reservoir considerations.
Q23. Which of the following sustainability-related standards, frameworks or initiatives does your organisation uses either as a reporting or management tool?
None of the above sustainability-related standards are used by ACCA in formulating the CSR report.
Q24. Please list other sustainability-related standards, frameworks or initiatives your organisation uses either as a reporting or management tool.
ACCA uses the GRI reporting framework when creating its CSR report.
Q25. Please list the top 5 material economic, environmental and social topics that your organisation has identified for its sustainability report, in separate fields.
For details of the below list, please refer to ACCA's 2010/11 CSR report (http://www.accaglobal.com/agm).
See page 25 of ACCA's CSR report.
See page 21 of ACCA's CSR report.
See page 26 of ACCA's CSR report.
Q26. Please indicate the entities for which your organisation prepares sustainability information. This may include any form of environmental, social, economic and governance information.
ACCA prepares sustainability information on a voluntary basis. As an advocate of corporate accountability and an organisational stakeholder in the GRI, it is felt that producing a sustainability report is important.
Q30. In response to stakeholder feedback, GRI's Guidelines could also include new guidance elements (eg principles, new concepts, definitions...). Which guidance elements, if any, should be added to the current Guidelines?
ACCA believes that the GRI should offer guidance on the assurance of its standards. By having sustainability reports assured by an independent auditor, an organisation would be able to produce reports that are far more credible and trustworthy than unassured information. The guidance should be developed in consultation with assurance experts.