Global Reporting Initiative (GRI) recently endorsed the likelihood that taxes will be paid by businesses as common international practice after support was received from a consultation exercise, and particularly from investment organisations.
Requests from investors, governments and wider civil society have called for more corporate reporting on tax as national economies become increasingly integrated.
GRI Global Sustainability Standards Board (GSSB), GRI’s independent standard-setting body, proposed to create a reporting standard on taxes and payments to governments earlier last year.
According to GSSB, a study by investment company RobecoSAM revealed that only 17% of 830 companied reported publicly on tax payments at a country level.
A 90-day public comment period on a draft tax standard saw 43% of the 85 submissions received—and 55% of the organisations represented—come from investment companies, who collectively manage assets worth in excess of 2.5 trillion US dollars globally.
Responses included organisations such as, CPA Australia, BEPS Monitoring Group and Accountancy Europe.
GSSB chair Judy Kuszewski said: “I am pleased by the high level of engagement in our proposals for a corporate tax standard. This supports the GSSB view that there is an urgent need to ensure greater transparency of the taxes companies pay, in the various markets where they operate.
“We are pleased that investment organisations have been so strongly engaged in this process, with the largest grouping of responses coming from investors. This demonstrates just how strong the demand is for reliable data on tax reporting and its relevance to investors and their decision-making.
“We appreciate all contributions put forward, which will be carefully considered by an independent expert committee and inform the development of the new standard.”
By Asena Degirmenci
