IIA Supports Release of International Integrated Reporting Framework
IIA Chairman Paul Sobel welcomes IIRC CEO Paul Druckman to the stage as a general session speaker at The IIA’s 2013 International Conference this past July. Druckman spoke to more than 2,000 attendees about Integrated Reporting and the important role of sustainability in today’s marketplace.
This week, IIA President and CEO Richard Chambers attended a meeting of the International Integrated Reporting Council (IIRC) to provide support for the official release of the International Integrated Reporting Framework (<IR>). The release of the Framework marks an important milestone in the market-led evolution of corporate reporting. It follows a three-month global consultation led by the IIRC earlier this year, which elicited over 350 responses from every region in the world, the overwhelming majority of which expressed support for <IR>. The Framework will be used to accelerate the adoption of <IR> across the world, where it is currently being tested in more than 25 countries, 16 of which are members of the G20, the group of nations focused on strengthening the global economy.
“The IIA is a proud participant of the IIRC. We understand the value of and need for the Framework. My congratulations to Paul Druckman, CEO of the IIRC, for the successful roll-out,” said Chambers. “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. The IIA’s participation in the IIRC is perfect timing as we have identified sustainability as a key priority for the Institute.”
<IR> applies principles and concepts that are focused on bringing greater cohesion and efficiency to the reporting process, and adopting “integrated thinking” as a way of breaking down internal silos and reducing duplication. It improves the quality of information available to providers of financial capital to enable a more efficient and productive allocation of capital. Its focus on value creation, and the ‘capitals’ used by the business to create value over time, contributes towards a more financially stable global economy and is a force for sustainability.
Commenting on the release of the Framework, IIRC Chairman Professor Mervyn King SC, said, “We have been taken aback by the degree to which mainstream businesses and investors have been willing to participate in creating this Framework and embarking on their own <IR> journey. Last month PepsiCo became the latest global company to sign up to the IIRC’s 100-plus strong business network, which includes HSBC, Unilever, Deutsche Bank, China Light & Power, Hyundai Engineering and Construction, National Australia Bank and Tata Steel.
“I am delighted that the day has come when businesses worldwide can use the Framework as a tool for the better articulation of their strategy, and to engage investors on a more long-term journey to attract investment that will be crucial to achieving sustained, and sustainable, prosperity,” said King.
IIRC Chief Executive Officer, Paul Druckman, said, “The Framework brings technical rigour and cohesion to a process that has grown organically and through market pressure over the last three years. Today we have fired the starting gun on a period of global adoption that will begin in early 2014 by showcasing practical examples of reporting innovation, including how businesses are demonstrating value creation using the ‘capitals’ model and principles such as the connectivity of information.
“We could not have reached this milestone without the dedicated support of our innovators, our Pilot Programme participants who have contributed so much to the development of the Framework. Together they have ensured that <IR> is relevant to the mainstream business and investor communities, and can be incorporated as part of existing reporting requirements,” said Druckman.
“We will use the Framework, together with examples and evidence of the business and investor case, to reach out to a wider pool of businesses who are seeking to adopt <IR> for the first time. It is the right time to participate in the journey towards a better, more cohesive reporting landscape that makes sense both to businesses and to the decisions of providers of financial capital, in this interconnected, complex and resource-constrained world."