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UN study proposes new guidelines for
corporate reporting on environment, labour rights
5 October 2006 – A “carrots
and sticks” approach coupling mandatory regulation with voluntary standards
will lead to better reporting by corporations of their performance in
non-financial areas such as environmental protection, labour standards, human
rights and anti-corruption measures, according to a new United Nations study
released today.
“It is clear that regulation by itself cannot provide all the answers,” UN
Environment Programme (UNEP) Executive Director Achim Steiner told an
international conference in Amsterdam at the launch of new guidelines for
reporting on key elements of the UN Global Compact, Secretary-General Kofi
Annan’s six-year-old initiative to advance good corporate citizenship and
responsible globalization.
“It needs to be balanced by appropriate market measures and voluntary action.
There is both a public and a business case for non-financial disclosure and
sustainability reporting in particular,” he added of the
report – Carrots and Sticks for Starters – jointly prepared by UNEP and
Global Sustainability Services of KPMG, a worldwide network of professional
firms providing Audit, Tax, and Advisory services.
The study gives an overview and analysis of current trends and approaches in
mandatory and voluntary standards for so-called sustainability reporting and
corporate responsibility.
It argues that balanced regulation should highlight the importance of a
publicly recognized set of performance indicators and stresses the need for
independent verification, stakeholder engagement, and the role of government in
enforcing a level playing field and introducing incentives such as relieving
reporting companies from obligations to report separately to individual
government departments.
“The idea of a sustainability report is still a novelty in many parts of the
world,” Mr. Steiner said. “We still have some basic, foundational work to do in
introducing to thousands of large companies the value of systematically
quantifying non-financial performance, using it as a management tool and
communicating about it publicly.”
The new guidelines, introduced at the Global Reporting Initiative (GRI)
Sustainability Reporting Conference, make
reporting simpler and include requirements to describe management approaches and
progress. Their online format is aimed to make reported information more easily
comparable for investors and financial analysts.
“Accountability and transparency are vital ingredients for gaining public
confidence and a societal 'license to operate'”, Mr. Steiner said. “From the
global to the local, agreed frameworks for reporting are the basis upon which we
build in moving closer to achieving these objectives. The GRI has played a
leading role in helping all of us in addressing this challenge.”
Source: UN News Service
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