Green reports make sound business sense
Support for compulsory annual environmental reports is far from universal among FDs.
According to this week’s Accountancy Age/Reed Personnel Big Question, they are about equally split on the issue, with many of those who are against the idea citing the extra burden of red tape it would impose.
Understandably, some say they have quite enough reports to compile already, thank you very much. And so they do. But environmental reporting – and its more widely defined cousin ‘sustainability’ reporting – should not be left on the backburner. It is one of the few things that company accountants can get involved in that there is a public appetite for.
Everyone from environmental activists to local communities to employees are interested in how a company’s activities impact on its environment.
And although some may feel they are producing yet more meaningless reports, the act of putting such a thing together forces a company to focus on the external impacts it has, and what it is doing about them. Its directors will also have something to brandish at anyone who asks questions about their activities. ICAEW secretary general John Collier tackles this issue on page 12 of this issue.
Together with Anthony Carey he emphasises the importance of corporate reputation for business survival, and makes the point that many purchasers are becoming more fussy about the ethics of their suppliers.
The message for finance directors is that these reports are about a lot more than pandering to the needs of a few environmental activists – there are sound business reasons for producing them.