Has the Global Reporting Initiative (GRI) produced the capstone to tax transparency reporting that industry was seeking?
The Global Reporting Initiative (GRI) has published the first global standard for tax disclosure reporting at the country-by-country level (GRI 207).
The release of the global standard in December is the latest in a series of jurisdictional and industry specific tax reporting standards released in recent years.
At first glance, GRI 207 is all-encompassing, capturing the most topical categories of public concern. It promises to be the next step forward for corporations wanting to streamline their tax transparency reporting obligations.
But looking to the detail, it appears GRI has flexed to potential concerns over data collection and calculation challenges. The standard is predominately focused on governance, rather than calculation. As a result there is substantial flexibility on the presentation of qualitative data, which at the same time means limited instruction for new reporters.
GRI 207 will be a valuable resource and important milestone towards promoting uptake and consistency in tax transparency reporting, but in itself is not the complete capstone that some in industry may have hoped for.
The GRI Standards were the first global standards for sustainability reporting. GRI’s framework is the most widely adopted for sustainability reporting, and is applied by tens of thousands of organisations globally. It continues to enhance its universal framework through the development of specific topic standards with economic, environmental and social focuses.
This latest standard, GRI 207, defines a framework for organisations to communicate their management approach to tax strategy and governance principles, and report on a country-by-country basis revenue, tax and business activities. Further, it provides a structure for organisations to define connections between their tax strategy and sustainability impacts.
Following almost a year of public consultation and feedback from over 250 stakeholders globally, its content reflects themes common to jurisdiction-specific public tax transparency reporting standards, such as Australia’s voluntary Tax Transparency Code (TTC), UK Public disclosure of Tax Strategy, and the EU Accounting Directive on Project by Project Reporting, as well as global initiatives such as the Extractive Industry Transparency Initiative (EITI). Similarities with the B Team’s Responsible Tax Principles are also identifiable, which are a behavioural rather than metric-based form of tax transparency reporting.
Read the full PDF report
KPMG Tax Now brings you in-depth feature articles regarding tax in Australia and overseas.
©2021 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.
Liability limited by a scheme approved under Professional Standards Legislation.
For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.