WELCOME CORPORATE REPORTING & SOCIAL RESPONSIBILITY: A STUDY OF SUSTAINABILITY REPORTING

1. WELCOMECORPORATE REPORTING & SOCIAL RESPONSIBILITY: A STUDY OF SUSTAINABILITY REPORTING Prof. Ranjan K. Bal Utkal University

2. CUSTOMER IS THE KING.DELIGHT OUR CUSTOMERS. • Who are the customers of Accountants ? • Challenge before the Accountant: To delight your customers

3. VISION STATEMENT OF M.A. Gr. JOHNSON & JOHNSON • Delight our customer • Develop alternative measurement system • Keep it simple • Utilise 20% time on accounting & 80% time on analysis • Be the best

4. POST ENRON ERA • Trust-Transparency gap • Information provided Vs. Information needs of Stakeholders. Osama Bin Laden wanted to become an accountant !!

5. CORPORATE REPORTING • Trust-me Culture • Tell-me Culture • Show-me Culture

6. MYTHS REGARDING CSR • A drain on profit -Contradicts the main objective • A charitable work • Don't contribute to the best interest of the corporation

7. CSR • A business process: Decision making-Sensitive about the effects on society • Stakeholders: Society & Community • Wealth creators Vs. Wealthdistributors • Mutual beneficial partnership • An investment by the Corporation

8. CSR ACTIVITIES BY SOME ORGANISTIONS • Bank of India: To adopt 101 villages • NABARD: Develop rural non-firm sector • HPCL: RasoiGhar, Hamara Pump, Leadership lectures • ICICI Bank: Partnering with NGOs, Capacity building • BPCL: Infrastructure Development, Healthcare

9. CSR Activities: Indian Cos. • 52% supported health • 50% supported education • 30% supported environment • 27% supported rural development • 36% have Dept. for CSR • 58% Top Mgt. involved in CSR

10. SUSTAINABLE DEVELOPMENT • Meets the needs of present generation • Without compromising the ability of future generations • Minimum environmental impact • Maximum value addition for customers

11. Research Findings: KPMG study: On “Measuring Performance of the Organizations of the Future” FINDING: “Over-reliance on summary financial performance measures (Viz. ROI) was hindering an organization’s abilities to create future economic value.”

12. RESEARCH FINDINGS • McKinsey & Co: 400 Firms “The environmental challenge is one of the central issues of the 21st century.” • World Economic Forum: 650 Executives “Environment is the most important challenge affecting business.”

13. Social Economic Triple Bottom Line Environmental

14. TBL or Sustainability Reporting • Framework for measuring business performance • Single bottom line to Triple bottom line • Shareholder-oriented accounting to Stakeholder-oriented accounting • 3 Ps: Profit, Planet & People TBLR is complementary to Financial Reporting.

15. SOCIAL BOTTOM LINE • Organisation’s impact on society • Public health & Community Dev. • Skill & Education • Social justice & Human Rights • Trust, Integrity & Teamwork • Labour practices • Product Responsibility

16. ENVIRONMENTAL BOTTOM LINE • Efficient use of natural resources • Efficient environmental mgt. • Renewable natural capital

17. ECONOMIC BOTTOM LINE • Economic profitability • Employment generation • Market creation • Financial capital & Physical capital

18. WHY TBLR? • Growth of Environmentalism • Growth of Social Consideration • Brand value & reputation • Risk reduction • Relationship with Communities • Exploiting market opportunities • Attracting & Retaining HR • Cost Reduction

19. KPMG SURVEY on SUSTAINABILITY REPORTING or TBLR: Benefits • Reduce operating costs & improve efficiencies • Develop innovative products & services for access to new markets • Improve reputation & brand value • Recruit & retain excellent people • Gain better access to investor capital • Enhance the public value of the company • Reduce liabilities through integrated risk management

20. SUSTAINABLE ENTERPRISE • Makes resource-efficient products • Minimum environmental impact • Maximum value to customers • Long-term shareholder-added value • Adding value to society.

21. FOUR TRENDS • Escalation • Integration • Standardization • Globalization

22. INITIATIVES • GRI (Global Reporting Initiatives) (www.globalreporting.org) • A4S (Accounting for Sustainability Project) (www.accountingforsustainability.org) • IIRC (International Integrated Reporting Committee) (www.theiirc.org)

23. IMPLICATION FOR FINANCIAL MANAGERS • In the areas of investor relations/PR • Telling a Co’s financial story = Telling the Co’s sustainability story

24. Corporate sustainability :Challenges • Balance between long-run & short-run needs of the firm & its stakeholders • Management & maintenance of economic, natural, social capital • Incorporating social & environmental dimensions into decision making process • Create “win-win” situation: create shareholders wealth by becoming social & environment friendly

25. CHANGE Change is the only constant in to-day’s world. “A company can not survive without change.”K.V.Kamath

26. “Earth provides enough to satisfy everyone’s needs, but not everyman’s greed.” -GANDHIJI

27. DISTINCT or EXTINCT “ACT NOW or GET READY TO BE A PART OF HISTORY.” THANK YOU