Over the last few months I have been connecting with leaders across KPMG to discuss the vital supporting role to be played by the audit profession to ensure that businesses report on their carbon footprints and sustainability agendas in a consistent manner, so that assurance on this information can be reliably provided by independent parties. The current COVID-19 pandemic has underscored the key importance of transparent reporting of the risks facing entities in this environment, including the resilience of their business models and global supply and value chains, and the interconnected role that financial and non-financial information play in achieving that goal.
We know that better connectivity between non-financial reporting and financial reporting, and the need for an integrated global corporate reporting structure, is a complex issue – and one that won’t be solved easily given the various affected parties and diverse perspectives of impacted stakeholders. Yet it is critical that we bring together these various perspectives and considerations in order to arrive at a consensus on a way forward and also, to ensure that further corporate reporting developments do not simply add to the multitude of existing frameworks.
I believe that the ultimate goal should be for a global standard for corporate reporting that considers the interconnectivity between non-financial information and financial reporting based on a conceptual framework for connected reporting. I outlined KPMG’s views recently in a response to an Accountancy Europe paper on these issues, which you can read in this document (PDF 53 KB). In my response I outline what I believe is required for a solution to interconnected standard setting for corporate reporting, including: