Quantitative criteria currently define how companies are categorised for regulatory purposes. Their turnover or number of employees often determine what legislation applies to them.

With global megatrends disrupting business models and markets, this publication aims to open the debate on how entities should be categorised. It does so by challenging the quantitative criteria’s suitability.

This thought leadership paper* proposes a risk-based approach to categorise companies which better reflects their impacts on the economy, environment and society. The paper also puts this thinking into practice by proposing a conceptual scorecard to assess entities’ risk profile. A holistic take on companies’ risks and impacts would enable policymakers to draft policies better suited for our increasingly complex world.

Our independent task force seeks input on the proposed approach from regulators and other interested stakeholders. Please send your views to [email protected] by 2 June 2020.

Summary:

*This publication is part of Accountancy Europe’s Cogito series. We set up Cogito (i.e. I think) to provide new ideas for the European accountancy profession, enhance innovation and contribute more to business and society. Cogito publications aim to stimulate debate; the views expressed thus do not reflect the official positions of Accountancy Europe or those of any of its 51 member bodies.