Businesses and other organizations need to improve reporting of the interconnections between their business activities with sustainability if they are to survive and thrive in the future, according to new research from ACCA (the Association of Chartered Certified Accountants)
MUMBAI: All professionals, and especially accountants, need to gather and use insights to better understand the relationship between sustainability-related matters and business activities if businesses are to survive, according to Making Information Connections for Sustainable Value Creation, the latest release in ACCA’s sustainability reporting research series.
Those that fail to do so are at risk of not being alert to challenges impacting their resilience and future survival, and could also miss good opportunities, says ACCA.
Unfortunately, connectivity for sustainability-related matters is not common practice among organizations in their corporate reporting activities, including the publication of annual reports. Frequently the connections are not communicated – risking poor-quality decision-making by all stakeholders. A survey of over 1,000 finance professionals from around the world (see notes to editors) revealed that only half (49%) of their organizations explain how sustainability is reflected in their operations and only 38% explain how they manage sustainability risks.
ACCA is recommending corporate disclosures built on the rules already laid down by the International Sustainability Standards Board (ISSB). This research has identified an opportunity for sustainable value creation by expanding the ISSB definition of connectivity and connected information to provide better information that will create more resilient business models.
Report author Sharon Machado, head of sustainable business at ACCA said: ‘Successful organisations have always worked to make connections but if we’re to make the progress on sustainability that the world needs then we’re calling on businesses to supercharge those connections. Currently, there is a real risk that progress will not be swift enough. Professional accountants are uniquely placed to connect sustainability-related information to financial information.’
The ISSB and some of ACCA’s network of business experts shared their valuable insights to help connect information for quality decision-making and sustainable value creation. Many of their recommendations call for professionals to leverage core ‘business as usual’ activities – but incorporate sustainability-related insights central to the organization’s survival.
The research was launched in the same month that ACCA was recognized with a special nomination in the international category of the UN Trade and Development (UNCTAD) International Standards of Accounting and Reporting (ISAR) Honours 2024. The award recognized ACCA’s 360-degree approach to building capacity for sustainable business through high-quality, connected sustainability and financial information.
ACCA has shared the research and guidance it has produced on a range of sustainability issues at the COP29 climate summit in Azerbaijan.
The research includes real-life examples and suggested activities to help professional accountants become the connectors that organizations need to create sustainable value. Read the research on the ACCA website.