In the media

19 August 2019

Towards an (inter)connected approach to corporate reporting standards setting

In this Q&A, Ethical Corporation’s managing director Liam Dowd talks with Hilde Blomme, deputy CEO at Accountancy Europe, on engaging the investor community, the role of finance in non-financial data and the biggest opportunity in the next 12-18 months

In the build-up to the 2019 Sustainability Reporting and Communications Summit, I talked with Hilde Blomme on the opportunity to engage investors on climate change, the increasing focus on non-financial data and the impact of new regulations on sustainability reporting.

Q. What is your role?

A. I am Accountancy Europe’s Deputy CEO, also in charge of technical aspects of our work to inform the EU policy debate. We are the umbrella organisation for 51 professional bodies from 36 countries, representing 1 million accountants in total.

Q. You are speaking at this year’s Sustainability Reporting and Communications Summit. Please share what you’ll be speaking on and why it’s important for you to be speaking at this event?

A. My keynote will cover how the Non-Financial Reporting Directive will impact your reporting process. We have done a lot of work to translate this law to daily business since it was created in 2014. For example, by sharing best practices in a mock-up report and tracking how member-states implement this. We consider this directive as a very good starting point.

But it is all about what happens in practice and accountants are crucial team players to help companies on this journey. This could eventually include assurance on non-financial information reporting or even ”integrated” assurance on all corporate reporting of an entity. I will elaborate on this in Theme 2 on Total Impact Reporting and Assurance of Data.

Q. Climate change poses one of the most significant financial challenges and opportunities for both companies and investors. What do see as the most challenging aspect of engaging investors on climate impacts?

A. Markets have proved to be a great transformative force: we need to leverage their power to move towards a sustainable economy. We need to change how the economy operates, starting with how businesses are run. Corporate governance is therefore instrumental and, as owners and capital providers, investors are a crucial part of that. It is no longer about doing good and making the world a better place: it is about staying in business. Investors will need to realise that once ecosystems and societies fail, there is no business either.

Boards have the power to transform their business. We think investors should give them space to start this change and make sustainability the cornerstone of business decisions. Please check our 10 ideas to help boards, policymakers and regulators undertake the necessary changes and the town hall debate on this.

Q. An increasing trend we’re seeing is the involvement of the finance and accounting departments to put values on non-financial data. From your experience, will there ever be the same validity to this data as standard financial data?

A. Non-financial reporting is gaining momentum, and so is the demand to rely on, and compare, these data. Some refer to non-financial data as pre-financial or extra-financial data, so most agree about their (eventual) financial impact. It is therefore not the same as financial data but working towards providing similar or equal validity is the way forward.

Accountants and auditors have the skills and methodology to become key partners in reporting and assuring non-financial data. Especially as businesses find non-financial drivers and key performance indicators (KPIs) more and more important – and more regulation is coming their way. We work with the WBCSD to promote best practices on non-financial assurance, and now work with the IAASB to harmonise how accountants approach such engagements based on an international assurance standard.

Q. And finally, in the space of sustainability reporting, what do you see as being the biggest opportunity in the next 12-18 months?

A. There is much progress in the area of non-financial reporting, but there is also proliferation of standards and frameworks. The time has come to consolidate these to make reporting more consistent, transparent and comparable as we already stated in 2017. We are currently working on a thought leadership project towards one global integrated reporting standard setter (or standard setting approach) to interconnect financial and non-financial reporting.

In this, we consider all types of solutions, for example three options that were recently put forward:

1) Oxford Union idea for the IFRS Foundation as the oversight body for global corporate reporting;
2) De Cambourg Report for regional consolidation; and
3) an open-source register based on blockchain protocols.

Hilde is speaking at our upcoming Sustainability Reporting and Communications Summit alongside senior practitioners from the likes of BlackRock, Siemens, Kingfisher, UN Environment, CDP, HSBC Global Asset Management, Moody’s Investment Service, Metro and ABN AMRO. The summit is Europe’s leading event focused on providing new ideas and insights on the future of sustainability reporting. Click here for more information

Read the interview here and sign up for our Sustainability newsletter to know more about our next projects on this.

Related content

EventEarly Warning Europe SME summit

30 September 2021

EventESEF in Practice

7 July 2021

EventSustainable financing 101 – State of play and next steps

24 June 2021

EventSustainable Corporate Governance – A fireside chat with MEP Heidi Hautala

21 June 2021

BlogSustainability risk management for SMEs: inaction is not an option

14 June 2021

NewsJoint statement on sustainable corporate governance

8 June 2021

Consultation responseFeedback statement: EU Taxonomy Article 8 Delegated act

3 June 2021

EventForce for Change: Mobilising the public sector for a sustainable economy

3 June 2021

UpdateSustainability

25 May 2021

PodcastThe shift to sustainability: A CFO’s journey

20 May 2021

Publication3-step sustainability assessment for SMEs

12 May 2021

Consultation responseIPSASB’s public consultation of Exposure Draft 75

12 May 2021

EventCorporate Sustainability Reporting Directive: Roadmap to implementation

12 May 2021

EventWorking Together for the planet: Audit & Assurance of sustainability Information

29 April 2021

NewsAccountancy Europe: Future-proofing tax to make it green, digital and fair

26 April 2021

NewsAccountancy Europe: Toughen the financial reporting ecosystem against fraud

23 April 2021

UpdateSustainability

23 April 2021

NewsAccountancy Europe welcomes EU progress on sustainability reporting standards

21 April 2021

NewsNew directive takes EU corporate sustainability reporting to the next level

21 April 2021

EventFuture-proofing tax: make it green, digital, fair

15 April 2021

Sign up for our newsletter

* indicates required
Would you like to subscribe to our newsletter?
On which topics would you like to receive news?