Over the summer I held several briefings with the Michigan Association of Certified Public Accountants (MACPA) regarding the statue of corporate and private sustainability reporting. There was a lot of interest in a few key topics and as we wind down this last official week of summer here in the northern hemisphere I thought I would offer a few reference and opinion sources on these and other matters.
First the wheels on the bus leading to integrated reporting continue to roll along. Integrated reporting according to the the Integrated Reporting <IR> project consists of demonstrating ” the linkages between an organization’s strategy, governance and financial performance and the social, environmental and economic context within which it operates.” The <IR> project is a outcome of the International Integrated Reporting Committee (IIRC) and supported by several leading sustainability concerns in the field including the Global Reporting Initiative (GRI). As many have observed, the only feasible way to include the use of GRI and other corporate sustainability and social responsibility elements into an annual financial disclosure is to consider these elements as strategic, with key performance indicators aligned to specific financial results, management discussions, and financial as well as non-financial outcomes. The Financial Accounting Standards Board (FASB) continues to monitor this activity and I expect we will see some movement and an initial opinion or formal comment period in this field in 2012.
Second is the area of sustainability marketing and in particular the recent discussion topic of “binding statements” made either as a part of sustainability reporting activities or the development of “green” product claims which have some upside marketing potential. These binding statements have recently been challenged with some very significant players in the consumer products space including SC Johnson. Christopher A. Cole is a partner at Manatt, Phelps and Phillips, LLP and his recent article on the Regulation of Green Marketing is a good read for an update on where these trends including the development of the so-called “Green Guides”may be heading, particularly in light of few regulations governing these claims and statements in the United States of America.
Finally the entire topic of “greenwashing” has received considerable attention and was one of the high areas of interest with respect to this summer’s MACPA briefings. These practices can range from “outright lying” to simple ignorance. Regardless these practices, which have had an impact due to some of the recent legal challenges noted previously, continue and cause confusion in both the marketplace as well as in corporate marketing circles. Tristan Roberts offers the recent article Recognizing the Nine Types of Greenwashing which is an excellent starter list for any corporate marketeer or officer responsible for ensuring a code of conduct and market claims are adhered to.
I hope to attend next month’s update on the topic with the MACPA forums en route to the Fall ISSP Conference in Portland, Oregon. Feel free to comment and get the conversation moving on these important an emerging topics.