The global evolution of corporate reporting has taken another significant step forward with the recent release of the Consultation Draft of the International Integrated Reporting <IR> Framework. The Framework creates the foundations for a new reporting model which will enable a business to provide a concise communication of how it creates value over time.
The International Integrated Reporting Council (IIRC), which is launching the Framework, is issuing a worldwide invitation to stakeholders to respond to the consultation. The goals of Integrated Reporting are to:
- Achieve a more cohesive and efficient approach to reporting.
- Inform capital allocation decisions.
- Enhance accountability and stewardship.
- Support integrated thinking.
Important features of the Framework include:
- Fundamental concepts, such as the capitals, business model and value creation.
- Guiding principles, such as strategic focus and future orientation, connectivity and materiality.
- Content elements such as organizational overview, opportunities and risks, strategy, performance and future outlook.
The Framework has been developed in a transparent way, with input from businesses, investors, regulators, standard setters, accounting bodies and NGOs. It seeks to build on existing financial and non-financial reporting practices, and responds to two current trends:
- The need for business transparency and responsiveness to stakeholders;
- The need for material information that guides corporate strategy, risk management and resource allocation.
The Framework will now be the subject of extensive consultation until 15 July 2013.
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