SUSTAINABLE ACCOUNTING REVIEW
environmental • economic • social | reporting • compliance • strategy
Your essential source for emerging practices and policies worldwide.
Welcome to the inaugural issue of Sustainability Accounting Review.
Sustainability accounting and reporting, or ESG reporting, as it is often called (environmental, social and governance), has traditionally been criticized as being exclusively a PR exercise and delegated to the investor relations function. These days are not entirely gone, but they are certainly going. Accounting bodies everywhere have recognized the overwhelming pace of change in this arena in the past ten years, and are now making it part of their professional curriculum.
Twenty years ago when I started writing in this space, this wasn’t even imaginable. The field has come a long way, spurned on by some rather unfortunate events, such as global warming and the meltdown of the international capital markets.
.... And the mountain of information, regulation and practice around sustainability accounting and reporting world-wide climbs ever higher, requiring the CFO and their staff to keep looking beyond their comfortable finance borders. The most recent report attempting to quantify and describe these initiatives shows that there are roughly 180 laws and regulatory standards in 45 countries calling for corporate sustainability reporting. To see the full report, click here. At the same time, several accounting and reporting frameworks have been developed to answer this call, including those of the Sustainable Accounting Standards Board (SASB) the International Integrated Reporting Committee (IIRC), CERES,and the Global Reporting Initiative (GRI), to name but four.
Similarly, coalitions have emerged between stock exchanges, investor groups and environmental/social advocacy organizations world-wide that are placing increasing scrutiny on the disclosures of publicly listed companies. The United Nations, for example, created the Sustainable Stock Exchanges (SSE) Initiative), which brings together stock exchanges, regulators, investors and other key stakeholders to promote improved disclosure on environmental, social and governance (ESG) issues. The SSE Initiative is co-organized by the Principles for Responsible Investment (PRI), the United Nations Conference on Trade and Development (UNCTAD), the United Nations Environment Programme Finance Initiative (UNEP-FI), and the United Nations Global Compact (UNGC).
In addition to the global movement towards sustainability disclosure, specific countries have laid down the hammer when it comes to improved transparency in corporate reporting. Since 2008, the requirements of the Dodd-Frank Act have expanded the disclosure responsibilities of the CFO beyond financial control into the realm of human rights and international social policy. On June 2, surrounded by much controversy and legal wrangling, an estimated 6,000+ publicly-listed companies in the US were required to file their Conflict Minerals Report. While filed separately from the 10-k and not subject to CEO/CFO certification, the preparation of the report must be considered as part of the broader standards concerning disclosure controls and procedures under Sarbanes-Oxley Act Section 302 and the SEC’s Rules 13a-15 and 15d-15.
As you see, the job of the finance manager has fewer and fewer boundaries. It is my hope that the launch of this journal, the only one of its kind world-wide, will make the job of the CFO and his finance function a little easier. It is the intention of Sustainable Accounting Review to offer you news and insights on emerging standards, regulations, and practices around sustainable (ESG) reporting and management from around the world. It is written from the perspective of what’s important and interesting to the finance executive and his staff in all industries. We synthesise the mountain of data and present it in a way that provides a snapshot of current events, and of future directions, while also sharing the insights of your colleagues and collaborators in this emerging practice area.
We look forward to hearing your feedback.
Ramona Dzinkowski, editor-in-chief