GNDI issues Perspective on Integrated Reporting
- Date: 29 August 2013
- Type: Media Release
A global network of director institutes has today released a paper supporting improvements to the way organisations report to their shareholders and other stakeholders, including in ways guided by the International Integrated Reporting Framework. However, the network has argued that any changes to the way organisations report should reduce the overall reporting burden on organisations.
These views are expressed by the Global Network of Director Institutes (GNDI) in their response to the International Integrated Reporting Council’s (IIRC) consultation on the draft international Integrated Reporting framework.
“Directors believe corporate reporting should result in concise, simple and focused reports that identify the material business risks that an entity faces, how that entity manages those risks and how they determine their success in managing those risks,” said John Colvin, Chair of GNDI.
“However, we have significant concerns that should Integrated Reporting be mandated, it is likely to result in overly
prescriptive, compliance driven corporate reporting ” said Mr Colvin.
GNDI put forward a number of concerns with integrated reporting mandates in the perspectives paper, which includes:
- The potential to significantly increase the cost of compliance for entities, as well as increasing the volume of reporting.
- The need to ensure that there is genuine investor demand for the disclosures in an Integrated Report.
- The potential increase in directors’ liability for the disclosures in an Integrated Report and the lack of an internationally harmonised safe harbour for
forward looking statements.
“Before any integrated reporting framework can be agreed to, the IIRC must identify the types of entities that would apply an integrated reporting framework and ensure global consistency” said Mr Colvin.
“They must also provide guidance on how the Integrated Reporting framework would fit within individual countries corporate governance framework, tax and corporate laws and determine the cost, benefits and implementation implications for entities and their shareholders.”
GNDI is supportive of entities and their boards effectively communicating those issues of significance to their shareholders in their corporate reporting.
“These factors must be addressed and encompassed within a principles-based, non-regulatory, “if not, why not” framework that recognises the diversity of business, encourages innovation and promotes entrepreneurial activity,” he said.
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Read the Integrated Reporting perspective paper.