The Global Reporting Initiative (GRI) and the Prince of Wales’ Accounting for Sustainability Project (A4S) have formed an International Integrated Reporting Committee (IIRC) tasked with developing a globally accepted integrated reporting framework.
Integrated reporting brings together financial, environmental, social and governance information – in a clear, consistent and comparable format.
The main purpose behind the framework is to improve accounting for sustainability. It is expected to also benefit investors and stakeholders who prefer a more holistic snapshot of companies than financial reports provide.
At present, a range of standard-setters and regulatory bodies are responsible for individual elements of reporting.
The A4S and GRI said an integrated reporting framework needed to be developed on an international basis to avoid the risk of multiple standards emerging.
The IIRC has five key goals:
- Raise awareness of the need for a global framework and develop a consensus among governments, listing authorities, business, investors, accounting bodies and standard setters for the best way to address it;
- Develop an overarching integrated reporting framework setting out the scope of integrated reporting and its key components;
- Identify priority areas where additional work is needed and draft a development plan;
- Consider whether standards in this area should be voluntary or mandatory and facilitate collaboration between standard-setters and convergence in the standards needed to underpin integrated reporting; and,
- Promote the adoption of integrated reporting by relevant regulators and report preparers.
Who’s who in the IIRC
The IIRC is comprised of a 34-member steering committee and a 20-member working group.
The working group will be responsible for drafting proposals for the IIRC’s governance arrangements, and the scope and content of integrated reporting.
It will be co-chaired by A4S chairman Paul Druckman and International Federation of Accountants (IFAC) chief executive Ian Ball.
The steering committee will provide guidance to the working group and consider whether to adopt the working group’s proposals.
It will be chaired by Michael Peat, the principal private secretary to the Prince of Wales.
The deputy chair will be Mervyn King, the chair of South Africa’s King Committee on Corporate Governance and chair of the GRI.
The remainder of the working group and steering committee will be comprised of representatives from the corporate, accounting, securities, regulatory, government, non-government, academic and standard-setting sectors.
The accounting profession is well represented, with the steering committee including the global chief executives of the Big Four, Grant Thornton and BDO, as well as:
- Association of Chartered Certified Accountants chief executive Helen Brand;
- Institute of Chartered Accountants in England and Wales chief executive Michael Izza;
- Chartered Institute of Management Accountants chief executive Charles Tilley;
- IFAC president Robert Bunting;
- International Accounting Standards Board chair David Tweedie; and,
- Financial Accounting Standards Board chair Robert Herz.
The working group includes Big Four and mid-tier partners, as well as representatives from the Japanese and South African CPA institutes.