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Idea Takes Root
Almost without notice in the American press, a new international effort is under way to create a standardized global reporting model for operating sustainable businesses in the 21st century. HBS professor Robert G. Eccles is on the steering committee of the organization established in London in early August to lead the effort — the International Integrated Reporting Committee (IIRC). Eccles is a leading voice in support of integrating financial and nonfinancial information into a single report to ensure sustainable business strategies.
In an August 2 blog post on the Harvard Business Review Web site, Eccles hailed the IIRC’s formation. The Financial Times covered the story in its August 3 edition. But the American press all but ignored the event. A database search of major newspapers and magazines turns up a single mention — a measly 163-word recap of the FT piece on the Dow Jones News wire. The IIRC deserves better, and here’s why.
As Eccles states in his blog, reporting both financial performance and performance in the areas of environmental sustainability, social responsibility, and governance in an integrated fashion has enormous benefits for shareholders and stakeholders alike. It is “the best way to ensure that companies have sustainable strategies; define them in financial, economic, social, and governance terms; and then communicate the results.” His recent book, One Report: Integrated Reporting for a Sustainable Strategy, makes the case in compelling detail.
The FT reports that the IIRC has the backing of the International Accounting Standards Board, the U.S. Financial Accounting Standards Board, and the International Organization of Securities Commissions. And Ian Powell, UK chairman of PricewaterhousewCooper, called the IIRC “an important step on the journey to create a new corporate reporting model fit for the 21st century.”
Indeed, Eccles and others are pioneering a new way for businesses to operate. Too bad the American press missed the story.
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