The collaboration, announced today, will drive better corporate reporting, helping companies and investors transition to a resource-efficient economy, the groups say.
CDP, CDSB and IIRC say they share a vision of corporate reporting for the 21st century in which harmonization of corporate reporting frameworks, standards and requirements leads to improved efficiency and effectiveness in reporting practices. The memorandum of understanding says reporting on the use and depreciation of natural capital — including carbon, energy, water and forest commodities — is integral to integrated reporting.
Capital markets need accurate information on corporate impacts on carbon, water and forests, says CDP’s chief executive officer Paul Simpson. He says partnering with the IIRC is a natural step as CDP works to encourage firms to integrate this data into their reports.
Paul Druckman, chief executive officer of the IIRC, says working with other frameworks and standards will accelerate the adoption of integrated reporting. IR is not intended to supplant other non-financial disclosures, Druckman says, but rather to utilize these disclosures, through applying the principles of IR.
The IIRC’s draft Framework relies on existing reporting standards, guidelines and approaches, such as the Climate Change Reporting Framework, which was developed by CDSB, a CDP special project, in conjunction with a range of global experts, including accounting professionals.
Companies have a long way to go before the reality of integrated reporting catches up with the ambition, according to a PricewaterhouseCoopers survey of the current reporting by large companies involved in the IIRC pilot program.
One hundred companies across the globe are part of the IIRC pilot program, including Coca-Cola, Microsoft, Unilever, Deutsche Bank, SAP, Jones Lang LaSalle and others. The program aims to test and help develop the reporting framework that will give a better view of their businesses. The PwC survey, published last month, examined the reporting by 50 of those companies that had already published their reports at the end of April.