A global body is to be created to help public sector organisations develop integrated reporting – reporting that incorporates both financial and other relevant information, including ESG. The new initiative, which will include inputs from investors, is to be christened the Public Sector Pioneer Programme, and will be formed jointly the International Integrated Reporting Council (IIRC) and the UK-based Chartered Institute of Public Finance and Accountancy (CIPFA).
Its main aim will be to ‘pioneer the implementation of integrated reporting across the various different types of bodies in the public sector to demonstrate how it can be applied’. However, its founders also hope that public sector bodies can use the group to share their experiences of integrated reporting with the private sector.
The IIRC said that although public sector organisations already publish a wide range of data on their social and environmental impacts, few present a ‘complete and coherent picture’ of how this links into their economic performance.
The decision to launch the programme follows a CIPFA scoping study of the issues involved in applying integrated reporting in the public sector. It concluded that integrated reporting principles ‘can readily be applied in the public sector, although there are some sector-specific issues to be considered in more detail to facilitate this’.
The IIRC has emphasised that although it sees value in a new, separate body looking at integrated reporting in the public sector, it does not see such reporting as being dramatically different. Its integrated reporting pilot programme, which involves more than 100 businesses across 26 countries, includes a number of public sector and state enterprises.
The Public Sector Pioneer Programme will be overseen by a steering group of representatives from the public sector and other organisations, with the secretariat provided by CIPFA and the IIRC. Calls for expressions of interest have been sent out to various bodies.
The initiative is expected to run over two years, covering two reporting cycles. An annual membership fee of £10,000 will be charged to those that participate.
Ian Carruthers, policy and technical director at CIPFA, said: ‘ With so much of global GDP spent by public bodies, applying integrated reporting principles will give the public a much more transparent view of how and where their resources are used.’
Public transparency is an important tool to encourage the development of long term investment behaviour, and is one of the goals of the new PRI Reporting Framework. A mandatory requirement for all PRI investor signatories is to publicly report on their responsible investment activities, and for the first time this year following the 2013-14 reporting cycle, public transparency reports will be made available from each signatory. A number of these RI Transparency reports are currently available on the PRI website, with the remaining reports to be published by June.