Key Insights on the Future of Reporting at the 3rd Annual Conference of the Reporting 3.0 Platform
The third annual Reporting 3.0 Platform Conference was a milestone in generating insights on how to design the future of reporting. Over 130 participants from all over the world came together in Berlin on November 12th - 13th 2015 to share their views on the next generation of sustainability and integrated reporting, accounting and data support. Read about the conference highlights and key conclusions as well as the Reporting 3.0 Platform in the following conference review.
How can reporting, accounting and data support the emergence of a green and inclusive economy, and how can gaps in all three areas be overcome? These questions were at the heart of this year’s conference. Some of the highlights and key messages of the conference’s keynote speakers and panelists included:
- John Fullerton from The Capital Institute delivered his ideas about ‘Regenerative Capitalism’. He questioned some of the often unquestioned assumptions of current financial and economic theory, such as exponential growth on a finite planet, and the belief that markets will solve problems if we enhance transparency and get prices right. As theories define what we see, we need new theories – and “Regenerative Capitalism” could serve as one such new theory.
- Allen White, co-founder of the Global Reporting Initiative (GRI) and founder of the Global Initiative for Sustainability Ratings (GISR), described the journey from Reporting 1.0 to 2.0 to 3.0 as a journey from extraordinary to exceptional to expected; from information to intelligence to insights; and from fragmented to comprehensive to holistic. Sustainability reporting advanced greatly in the last two decades, but there is still a long way ahead of us to make sustainability reporting mainstream.
- Elisa Tonda of UNEP officially launched a new UNEP report: Raising The Bar - Advancing Environmental Disclosure in Sustainability Reporting. The report urges companies to align their sustainability performance and reporting to match expectations of the 2030 Agenda for Sustainable Development. Key challenges in quality sustainability reporting are, as stated in the report, the need for harmonizing and strengthening of materiality determination and assurance methodologies; the need for greater collaborative reporting, through more engagement with upstream value chains (e.g. suppliers) and downstream stakeholders; and an alarming under-use of the sustainability context principle - placing performance of a company in the context of the limits and demands on environmental or social resources.
- Claudine Blamey from The Crown Estate presented the company’s approach towards ‘Total Contribution’, a way to measuring value beyond financial return. “Total Contribution” highlights non-financial impacts in financial terms, and thus creates a common language in the company to raise questions relevant for business decisions, planning and budgeting. Integrating sustainability aspects into the whole company succeeded at Crown Estate not least because the company is strongly purpose-driven.
- Jyoti Banerjee from the IIRC presented the core ideas of the
framework: Starting from the notion that value is today mostly reduced to financial value, the IIRC is based on the assumption that doing financials alone is not enough. For a sound judgement on a company’s ability to create value today and in the future, it is necessary to not only look at financial capitals, but different sorts of capitals. Exactly this notion is captured in the framework’s six capitals model. Jyoti highlighted that the Framework was never intended to be a framework for sustainability reporting. This said, he acknowledged that sustainability reporting will stay an important element besides integrated reporting, as it focuses on sustainability impacts, whereas integrated reporting focuses on value creation. The two approaches look at the company from different perspectives – and are often complementary.
- Rodney Irwin from the WBCSD talked about the outcomes of “Reporting Matters”, the 3rd edition of their member’s research on the quality of sustainability reporting. He emphasized that ‘reporting’ needs to be distinguished from ‘communication’, and identified room for improvement not only on the reporting, but also the communication side. He called reports that are not read by the stakeholders “stranded assets”, and stressed that reporting is not an end in itself, but a tool with the potential to trigger change and advance companies’ sustainability performance. Too often, he concluded, is sustainability reporting characterized by a robotic approach that misses the potential for change.
- Nelmara Arbex from GRI emphasized that sustainability information is often ‘locked in’ in lengthy pdfs, and must be ‘unlocked’ as for this information to be the basis for sustainable decision making in organizations. Information on sustainability management and performance has to become more accessible, comparable and available in real-time – otherwise, it remains useless.
- Cornis van der Lugt, Senior Associate at BSD Consulting, presented MaterialityTracker, a hub for materiality trends and standards. Cornis noticed that companies often collect sustainability data, but that they rarely connect them with financial data – and thus the business relevance of sustainability information remains fuzzy and implicit.
Discussions were stimulating at the conference, and the assembly of sustainability reporting experts, data cracks, accountants, company and NGO and NPO representatives resulted in an inspiring atmosphere.
Among the many takeaways of the conference, let us highlight three aspects:
- A core assumption of the sustainability reporting community is that transparency transforms. However, we increasingly need to move from transparency to decision-making. Sustainability information that is available but not integrated in a company’s decision-making processes is not unfolding its full potential to moving companies towards a more sustainable path. Working towards integration is therefore key. This requires better data, as sustainability data today is often not robust enough.
- To become future-fit, reporting needs to be put in context. Companies need to be seen as parts of a broader macro system, and assessing a company’s sustainability performance is only possible if the company’s performance is linked to this broader context. Science-based targets are one promising approach.
- There are many actors working on making reporting future-fit, and an array of excellent tools on data collection and management, stakeholder engagement, new forms of accounting and promising news methodologies are already available. However, there is a need for better collaboration between the different actors to pull the pieces of the puzzle together into a shared vision on how reporting, accounting and data can serve a green & inclusive economy.
The conference showed that there is a consensus that we need to move to better reporting – however, it is not always clear what better reporting in practice looks like and how it can be implemented. We need to learn along the journey and gain and share experiences – and the reporting 3.0 platform provides a space to foster this dialogue.
The Reporting 3.0 Platform
The Reporting 3.0 platform (R3) offers a unique and pre-competitive safe space for discussion, a lab for solutions development, and hands-on support to the relevant constituencies. R3 was launched in 2012 by BSD Consulting with the aim to create a multi-stakeholder oriented global community to coordinating, structuring and furthering the development of knowledge and solutions in the field of non-financial reporting. Between 2012 and 2015, three international conferences, three transition labs, four regional roundtables and several research papers were realized.
Launched by BSD Consulting and operated by the Reporting 3.0 team in Germany, the operating and governance model of the Reporting 3.0 platform is currently transformed, with the aim to established R3 as an independent not-for-profit organization under a multi-stakeholder governance model. For more information please contact Peter Teuscher, email@example.com, +41 44 260 60 30
Visit the Reporting 3.0 Website with more information on the conference as well as a short video summarizing the highlights.
A detailed summary of the 3rd Annual Conference is available here (PDF).