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November 8, 2010

WCOA: Accountants have a key role to play

KUALA LUMPUR: One of the core issues facing
accountants today is the advisory role they can play in helping
companies report on the impact of their operations on society – in
other words, integrated reporting.

Global Reporting Initiative chairman Prof
Mervyn King is widely accepted as one of the champions of good
corporate governance and sustainability. He wants accountants to
take a lead role in the movement towards meaningful integrated
reporting.

“What I expect to get out of [the WCOA] is an
appreciation by the world’s leading accountants, some 6,000 of
them, that they had a huge role to play in being advisors to
companies to moving to integrated reporting. It’s a question of
what impact operations of a company have on society and environment
and financially,” King told Congress Daily.

“One can no longer just look at a company’s
long term strategy but also sustainability issues which are
pertinent to the business of the company. An example is SAB Miller,
the second biggest brewery in the world. As part of their long term
strategic planning one of their new breweries will be a large ship
at sea in which they will take on ocean water and desalinate it.
It’s quite extraordinary thinking simply because of the fresh water
crisis as water is a critical factor in making beer.

“This is where long term goal and it shows the
institutional investor that here is a board committed to the
long-term plans of its company. If you think you can carry on
business as usual, I’m afraid you’re not planning properly.”

CPA Australia is the first financial
organisation to produce a sustainability report. Chief executive
Alex Malley wants to see accountants stepping up to the plate to
become key resource advisers that can influence change and good
starting point would be to tackle complexity within annual
reports.

“If you look at an annual report over a period
of the last 20 years and you were to have locked it in a time
capsule, it’s a wonderful example of where society is in this point
of time,” Malley said.

“Gone is the cigar swilling chairman that sits
at the front of the cover with all the power and control in the
world. Now is a complex annual report that tries to factor in
sustainability, non-financials and so on. We’re at that stage where
we are over complicated and we need to sit back, re-think,
re-adjust and simplify and respect our resources more. It’s about
the leadership of that.”

King
will take part in Plenary Session 3: Accounting for
Sustainability: The Integrated Reporting Framework
at 9am on
Thursday. Malley will take part in Plenary Session 4:
Accountants in the Next Decade – Embracing Change and Seizing
Opportunities
at 11am on Thursday.

 

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