The World Economic Forum Annual Meeting, held in Davos on 25-30 January, dedicated a session to integrated reporting. Considering the growing interest in the environmental, social and ethical risks associated with global business, the session sought to address the key question: how should corporate reporting be redesigned to integrate critical information on these risks under a common framework?
The session, moderated by Yale Professor Daniel Esty, saw PWC International Chairman Dennis Nally, KPMG Europe Co-Chairman Rolf Nonnenmacher, Global CEO James H. Quigley of Deloitte and James S. Turle, Chairman and CEO of Ernst & Young, as discussions leaders, addressing what they see as key developments in corporate reporting. World Economic Forum Director Richard Samans and GRI Chief Executive Ernst Ligteringen acted as challengers before moving to roundtable discussions, chaired by the four discussion leaders. The big four accounting firms above, as well as Richard Samans and Ernst Ligteringen, are all part of the IIRC or its Working Group.
In the roundtable discussions, participants shared their views on some of the aspects that will be relevant to such a framework, including how it would help to determine materiality in reports. The session also discussed how a framework can best facilitate the combining of financial, economic, environmental and social performance and risk information with corporate governance and business strategy.
Several of the participants also addressed the possible role of regulators in creating a reporting regime that would encourage integrated reporting. South Africa was highlighted as an example: the Johannesburg Stock Exchange (JSE) has mandated King III, which calls for integrated reporting on a “report or explain” basis. Outcomes of the discussions will be shared with the International Integrated Reporting Committee.