The Association of Chartered Certified Accountants (ACCA) calls for action dealing with the challenges of social and environmental value in its new report which examines the role of business in ESG issues and assesses corporate disclosures on key social and environmental issues around the world.

According to the report, risk analysis of climate change issues, social impact evaluation and assessing the quality of non-financial information are some of the ways professional accountants, finance teams and investors can support social and environmental value creation. They are incorporated into investment processes including asset valuation, asset allocation and risk management.

To support sustainable prosperity creation, governments and regulators are asking businesses to better manage their social and environmental impacts. In turn, citizens are asking their governments to do more to protect the environment and resolve societal issues.

As the fifth year anniversary of the 17 UN Sustainable Development Goals approaches, leaving ten years to achieve these changes by 2030, governments, business and civil society can better understand and improve how economies can deliver inclusive and sustainable prosperity.

ACCA executive director of strategy and development Alan Hatfield said: “Professional accountants and finance teams can support social and environmental value creation in many ways with their existing skillset and by reaching out across their own organisations.

“By interacting with wider stakeholders on complex challenges, they will be able to speed up the urgently needed transition to a more socially just and environmental aware future for the global economy. We are committed to pushing this forward by developing professional accountants with an ethical approach, combined with a wider view of business that covers financial, business, digital and sustainability issues.”

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CFA Institute managing director Europe, Middle East and Africa Gary Baker said: “The global finance industry has the power to utilise the trillions of pounds worth of assets under management to effect societal and environmental change, as well as improving the overall governance of companies. Over the long-term, action in this sphere can only be beneficial for companies and the shareholders and stakeholders they serve.

“Companies that drive short-term profit and ignore long-term risk will be unsustainable and ultimately will be divested from investment portfolios; capital will be redirected toward more productive enterprises that generate real long-term value creation. Now is the time for our professions to realise the crucial role they hold in driving sustainable businesses, and in leading the financial industry to deliver positive impact on society and the environment.”

Datamaran CEO and founder Marjella Alma said: “Ethical business practice is no longer a nice to have, but on many aspects, such as human rights, waste management and climate change, it's the law. However, some companies are still lagging. Our data shows that although the volume of reporting on key social and environmental issues has increased from 2014 to 2019, a number of key areas, such as animal welfare and human trafficking, still receive low coverage.

“A systematic monitoring of trends, made possible with technology, can help companies stay ahead of the curve and proactively address these issues, fulfilling their commitments and responsibilities. And this starts with better, more strategic disclosure.”