IIA Joins International Integrated Reporting Council and Declares Sustainability as Strategic Priority;
Plans to Provide Comment on Integrated Reporting Framework Consultation Draft
ALTAMONTE SPRINGS, Fla. - Richard F. Chambers, CIA, CGAP, CCSA, CRMA, president and CEO of The Institute of Internal Auditors (IIA), has been appointed to the International Integrated Reporting Council (IIRC), a global coalition of regulators, investors, public companies, standard-setters, professional bodies, and NGOs working together to develop a new model for corporate reporting. “Integrated reporting” (IR), as it’s called, is a process that concisely communicates how an organization’s strategy, governance, performance and opportunities lead to the creation of value over time. The concept of IR is an evolution in corporate reporting and benefits organizations, investors, and other stakeholders by enabling a more informed decision-making process and the advancement of a more sustainable global economy.
“Assurance plays a vital role in corporate reporting by providing an additional level of confidence for investors and other stakeholders in the information provided by businesses; it’s a natural fit that The IIA be a part of developing any framework that may impact internal auditors in their roles of providing assurance,” said Chambers. “The IIA’s participation in the IIRC is perfect timing as we have identified sustainability as a key priority for the Institute.”
Corporate reporting has been in a state of continuous evolution. In the past 20 years, organizations have been introduced to International Financial Reporting Standards (IFRS) — which are now adopted in more than 100 countries — as well as to sustainability reporting which has become best practice for the world’s largest businesses. Integrated Reporting does not seek to substitute for these established norms of disclosure, but instead provides a full set of concise information that captures the full range of factors around financial stability and sustainable business practices that incorporate environmental, social and governance (ESG) initiatives to drive how an organization creates its value in the short- and long-term.
The IIRC, chaired by internationally renowned Professor Mervyn King, has released a consultation draft of an International Integrated Reporting Framework for review and comment by July 15, 2013. Feedback can be provided through the IIRC’s website. The IIRC plans to issue the initial version of the Framework in December 2013 and to update it periodically as IR evolves. IIA Global will utilize its global network of internal audit professionals to prepare a consolidated response.
In March, the Executive Committee of The IIA’s global Board declared sustainability as a strategic priority. Investors and investor groups are increasingly looking at sustainable performance as an additional indicator of overall business value. Organizations in all sectors are placing additional focus on incorporating sustainable business practices, as well as on measuring and reporting results. In turn, sustainability initiatives are permeating governance and risk management processes, resulting in the need for internal auditors to provide assurance over their organization’s sustainability activities and reporting.
“We are committed to helping internal auditors worldwide better understand how sustainability is both an opportunity and risk to organizations, and the critical roles they play in ensuring that organizational governance, risk management, control, and reporting activities appropriately contribute to the achievement of sustainability objectives,” said IIA Chairman of the Board Phil Tarling, CIA, CRMA, CMIIA.
The IIA’s strategic initiatives on sustainability will include developing guidance, and thought leadership, participating on global sustainability projects, and delivering education to enhance the related knowledge, skills and relevance of its global members. In addition to participation on the IIRC, The IIA has secured Paul Druckman, IIRC CEO as keynote speaker at The IIA’s upcoming 2013 International Conference in Orlando, Fla. July 14-17 to address the role of internal auditing in integrated reporting. A sustainability track also will be offered at The IIA’s 2014 International Conference in London, England. Additional initiatives to support The IIA’s commitment to sustainability will be announced later this year.