I recently attended the annual Accounting for Sustainability Forum in London held just before Christmas. Joining me was Lee White (the Institute’s Executive General Manager – Members) together with a 200 strong contingent from the international accounting and business communities, investors, government, academia and civil society. Addressing us at St James’s Palace State Apartments, HRH the Prince of Wales, and the Chancellor of the Exchequer, the Rt Hon George Osborne, joined forces to highlight the role businesses have to play in ensuring the future of the planet.
The fifth annual gathering of The Prince’s Accounting for Sustainability Forum stressed the ever present need for businesses to put a value on, and better account for, the social and environmental impacts of their activities. At the Institute, we have always advocated the use of Broad Based Business Reporting as a recognised method of reporting for non-financial activities.
The importance of accounting for sustainability was brought to life by a short film called ‘Business Leader or Eco-Warrior’ starring Sir Richard Branson and Dragon’s Den stars Theo Paphitis and Deborah Meaden.
Several important steps were taken to increase the profile and prominence of sustainability reports in particular. The Chancellor announced the UK Government’s plan to fully implement sustainability reporting across its business divisions starting April 2011. This is a very significant step for a government and it will be interesting to see whether other countries, including Australia, follow this show of leadership.
Should our government perhaps take a step in this direction as well? I believe they should. Sustainability reporting is relevant to everyone including government. Taking a similar step here in Australia would be a signal to the market of the importance government is placing on sustainability.
What will it mean for government departments preparing financial statements? Basically, it will be mandatory for all central government departments and the National Health Service (NHS) to publish a sustainability report in their annual reports, which will encompass carbon emissions, waste management and use of finite resources – reflecting the integrated reporting requirements recommended by Accounting for Sustainability.
Other non-financial components of the sustainability report include direct and non-direct greenhouse gas emissions, the absolute cost of waste disposal and data on water consumption. Sustainability reporting does matter. What are governments doing about it?
Showing posts with label sustainability. Show all posts
Showing posts with label sustainability. Show all posts
Friday, January 7, 2011
Friday, December 10, 2010
Water is the drop for December
With devastating floods sweeping across parts of NSW and Victoria, water is ironically in abundance this time. The Murray Darling Basin Plan came about because the Basin is under enormous stress as a result of past water-allocation decisions, prolonged drought, natural climate variability and emerging climate change.
Recent Institute events have brought the topic of accounting for water into the spotlight for members. There were some lively sessions on water accounting held at the Institute’s Business Forum in Brisbane and at the Wine Industry Day in Adelaide.
By bringing hydrologists and accountants to the table, the Water Accounting Standards Board (WASB) released an exposure draft of its first water accounting standard, called Exposure Draft of Water Accounting Standard 1: Preparation and Presentation of General Purpose Water Accounting Reports (EDWAS 1).
The purpose of the draft is to elicit practical feedback for the final Australian Water Accounting Standard. By accounting for water, valuable information will be available to different user groups about one of Australia’s most essential yet precious resources. As water becomes scarcer and competition for water grows, the need to account for how it is sourced and distributed will increase.
So what is water accounting? It is a systematic way of identifying, recognising, quantifying and reporting on water, water rights, water obligations or other claims to water. Water accounting is very similar to general financial accounting, but we’re using volumetric rather than financial measurement, and the focus is on water rather than other assets and liabilities.
The challenges of water scarcity were very evident during a discussion at the Institute’s Wine Industry Day. Water is an integral part of the process of making wine - from growing grapes to actually producing the finished product. The wine industry has been proactive in establishing new ways of doing things to reduce the need for water although, obviously, water can never be removed completely from the wine making process.
Water and the way the wine industry is starting to adapt are really good examples of why companies are embracing sustainability as core to strategy. As I have said previously, sustainability is about managing risks - water and its availability in the future will be a major risk to many organisations.
Recent Institute events have brought the topic of accounting for water into the spotlight for members. There were some lively sessions on water accounting held at the Institute’s Business Forum in Brisbane and at the Wine Industry Day in Adelaide.
By bringing hydrologists and accountants to the table, the Water Accounting Standards Board (WASB) released an exposure draft of its first water accounting standard, called Exposure Draft of Water Accounting Standard 1: Preparation and Presentation of General Purpose Water Accounting Reports (EDWAS 1).
The purpose of the draft is to elicit practical feedback for the final Australian Water Accounting Standard. By accounting for water, valuable information will be available to different user groups about one of Australia’s most essential yet precious resources. As water becomes scarcer and competition for water grows, the need to account for how it is sourced and distributed will increase.
So what is water accounting? It is a systematic way of identifying, recognising, quantifying and reporting on water, water rights, water obligations or other claims to water. Water accounting is very similar to general financial accounting, but we’re using volumetric rather than financial measurement, and the focus is on water rather than other assets and liabilities.
The challenges of water scarcity were very evident during a discussion at the Institute’s Wine Industry Day. Water is an integral part of the process of making wine - from growing grapes to actually producing the finished product. The wine industry has been proactive in establishing new ways of doing things to reduce the need for water although, obviously, water can never be removed completely from the wine making process.
Water and the way the wine industry is starting to adapt are really good examples of why companies are embracing sustainability as core to strategy. As I have said previously, sustainability is about managing risks - water and its availability in the future will be a major risk to many organisations.
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