The EU legislative framework on reporting
non-financial information lacks transparency and is too fragmented,
according to the findings of the European Commission’s consultation
on non-financial reporting.
The majority of the 259 stakeholders
responding to the consultation expressed support for the concept of
integrated reporting, saying it should be embraced at EU level.
Many responding to the consultation also
believe the EU should draw on frameworks already developed at
international level rather than on elaborate new standards and
principles on non-financial reporting.
Regardless of strong support for integrated
reporting, some warned that there must be further reflection and
development, especially on how best to make integrated reporting
operational, without unduly increasing the administrative burden
for companies.
Some of the arguments against integrated
reporting questioned its feasibility in the short term. The most
commonly expressed concern being that coordinating financial and
non-financial reporting could lead to an information overload, or
too little information.
In areas where extensive non-financial
reporting requirements are in place member states said this hasn’t
lead to excessive administrative burdens.
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By GlobalData “A majority of respondents also
highlighted that potential costs could be considered as investments
needed to build capabilities that are necessary for managing
properly the overall business, leading to better long-term
performances,” the EC summary report said.
The Public Consultation on Disclosure of
Non-Financial Information by Companies was launched in
November 2010 with the consultation period ending 28 January
2011.
The EC said it most of the 259 responses came
from companies/preparers, users and NGOs, with 8% of responses
coming from accountants and auditors.
