Non-financial reporting – a better way to analysing corporate social responsibility
Eurocadres welcomes the recent initiative of the European Commission to foster a framework of integrated reporting which brings together financial and non-financial information about a company. Therefore, Eurocadres has responded to the recent EU consultation on non-financial reporting guidelines.
Disclosure of corporate policies for environmental, social and governance aspects has become increasingly important. Stakeholders, ranging from consumers and employees, local communities and NGOs to investors, are more and more concerned with companies’ compliance with social and environmental regulation. A growing body of evidence shows that companies with a strong corporate social responsibility (CSR) also have a strong financial performance: social and environmental aspects and a strong governance are positive factors for dealing with risks and opportunities.
Eurocadres has always supported a substantial dialogue on social matters and push companies and businesses to integrate social concerns in their activities. CSR is a tool to establish a process which adds value to existing legal minimum standards and which strengthens social dialogue, collective bargaining and industrial relations. Therefore, Eurocadres welcomes the initiative of the Commission to issue guidelines for an integrated reporting which gives a methodology for reporting non-financial information. Non-financial key performance indicators include figures on environmental and social aspects of corporate life, i.e. the carbon footprint, observations on internal mobility, engagement with local communities, etc.
Eurocadres welcomes the initiative of the Commission to issue guidelines
The practice of non-financial reporting has largely developed on a voluntary basis and essentially by multinational companies. The European Directive on non-financial reporting (Directive 2014/95/EU) aims at harmonising the consistency and comparability of non-financial information disclosed through the Union. It is aimed at companies listed on EU stock exchanges as well as unlisted companies such as credit institutions and insurance undertakings and large companies defined by criteria based on the average number of employees, net turnover and balance sheet total.
In the recent consultation, Eurocadres underlined that corporate reporting should provide tools for quantifying companies’ various non-financial impacts and allow comparison between companies and sectors. Therefore, it should be reasonably standardised. It should furthermore enable users with economic interest (suppliers, customers, employees), to control the global supply chain and check as to whether the company complies with broader principles such as the UN Global compact and the ILO declaration on tripartite principles for multinational enterprises.