Sustainability reporting as a key tool for a better world
September 16, 2021
3 min read
What do an accountant and protecting our planet have in common? This question might come as a surprise to many but the intimacy of the two matters might be closer than one would immediately think.
Sustainability as a buzzword has been around for at least three decades now but it seems that the world has only suddenly woken up to the need to take it seriously, as we witness the negative side effects on our planet that improving economic wealth has brought with it.
Increasing social difficulties, people at risk of poverty, rising inequalities and discrimination have highlighted the social failures of globalisation, with an increasing cohort of the population failing to reap the benefits of economic growth. At the same time, extreme temperatures, flooding, wildfires, biodiversity loss have pushed climate change as a matter of major concern in a short space of time. While the Maltese population has been generally concerned about social issues, climate change barely featured among Maltese citizens’ concerns in regular opinion surveys up to just few years ago. Yet, this issue has catapulted itself to the top priority as our green fundamentals have been badly shaken up.
Suddenly, governments, businesses and individuals have realised that we are at the very last chance to save our world, if not beyond the point of no return. While public authorities can drive policy, private entities have a significant contribution to play and this is where the concept of sustainability in the business world kicks in. Practically every decision taken by a firm, can have environmental, social and governance ramifications. These can include multitude issues whether the use of resources, where and how to procure them, human rights, consumer protection, diversity and the way enterprises are managed.
Through sustainable finance, ambitious European and global targets can be achieved step by step by channelling private investment to support economic growth while reducing pressures on the environment and taking into account social and governance aspects.
This is no easy task and redirecting capital towards sustainable investment envisages a comprehensive paradigm shift. At the same time, individuals are becoming more aware and demanding of how the companies they invest in are spending their money. Consumers have become more conscious when buying products and seek to know how it is being sourced and to know how committed a firm truly is to global challenges.
While companies nowadays, as it is their right, operate public relations machines to understandably sell their responsibility efforts, the only way of actually knowing what they are doing with their money is to have it disclosed in financial statements in terms of non-financial information disclosures. And here is where the role of the accountant kicks-in. The accountant has a fundamental role to play as a gatekeeper of the private sector’s efforts towards sustainability.
The sector has not been caught unaware at this new reality. Rather, the profession has already over the past years sought to establish common standards on non-financial disclosures, particularly on issues surrounding Environmental, Social, and Governance (ESG) concerns.
Given the rise in importance of financial reporting in measuring an entity’s commitment towards sustainability, the Malta Institute of Accountants is taking the lead in discussing this issue in a high-profile conference while carrying out an in-depth discussion on the anticipated transformations affecting the sector in the wake of the Corporate Sustainability Reporting Directive (CSRD) proposal by the European Commission.
The event, taking place on Wednesday, September 22, will focus on the theme of a New Mindset: Reduce. Reuse. Report – reflects a growing awareness among professionals about their responsibility towards sustainability in the private and public sectors.
Further details on this event are available through this link
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