This is a very thoughtful piece by Keith Ambachtsheer that suggests a way to test whether the news about ESG integration is real or hype: 

I am proposing a simple test to answer this important question: carefully study how asset owners tell their value-creating stories to their stakeholders. Unless these stories are clearly credible, the ‘shift to ESG investing’ is just another case of investment-industry hype triumphing over reality.

Why focus on the behaviour of asset owners? Because regardless of whether they are pension, endowment, or sovereign wealth funds, asset owners have a fiduciary duty to create value for their stakeholders. Collectively, they sit on top of the financial food chain and where they go, others follow.

He cites the IIRC Framework as an important tool in telling this story. 

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IIRC Lead Bob Laux published a piece on the council's website about the need for and efforts underway to support longer-term thinking in U.S. corporations. The full piece is worth reading. It includes this call to the SEC:

We at the IIRC believe the SEC should consider a project to reexamine their guidance on Management’s Discussion and Analysis. It has been 15 years since the last time the SEC issued a significant Financial Reporting Release reexamining their guidance on Management’s Discussion and Analysis. We can all agree there have been significant changes since 2003 and many believe a multi-capital approach to Management’s Discussion and Analysis could go a long way in serving the long-term interests of Main Street investors.

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Bhakti Mirchandani has some specific suggestions on Mainstreaming Sustainability: What Banks And Business Schools Should Do Next: 

Assets globally that are invested in line with environmental, social and governance (ESG) principles, or sustainable investments, have been growing 17% per year and now stand at $23 trillion according to McKinsey. The growth of US ESG assets in particular is up over 200% from the past decade according to JPMorgan. As institutional investor demand for ESG products mounts due to robust ESG performance and stakeholder pressure to address global challenges, banks and business schools alike should offer mandatory sustainable investing training to meet the demand for financial services professionals who understand sustainability.

Read her suggestions

This article covered a speech by Jan Herringer, partner at BDO USA and president of the New York State Society of CPAs at a meeting of the Accountants Club of America.  In her remarks, she encouraged her colleagues to learn about integrated reporting:

The profession is mobilizing to meet the challenges of the 21^st century, to close the link between value creation and the ability of an entity to sustain operations into the future … As the conscience of the profession, learn more about integrated reporting, discuss [it], and provide opportunities for our clients to understand the impact.”

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The Corporate Reporting Dialogue, which includes the IIRC, SASB, GRI, and the Carbon Disclosure Project, have announced plans to align their standards and frameworks within two years at the World Congress of Accountants in Sydney, Australia.

The article explains the goal of the project:

Under the new project, the various participants plan to map out their own sustainability standards and frameworks to identify the common traits and differences, while jointly refining and continuously enhancing the overlapping disclosures and data points to achieve better alignment. They will be taking into account the various focuses, audiences and governance procedures of the different organizations. Participants will identify how non-financial metrics relate to financial outcomes and how this can be integrated in mainstream reports.

More information about the project can be found on the Corporate Reporting Dialogue website. 

Read the Accounting Today article

Richard Barker and Bob Eccles at Said Business School of Oxford University have published a briefing paper as a prelude to a debate on December 11:

The goal of this ‘Green Paper’ is to contribute, in a neutral way, to a conversation that has been going on for some time amongst a variety of actors, concerning whether mandatory reporting standards are a prerequisite for effective ‘sustainability’ or ‘nonfinancial’ corporate reporting. Specifically, we ask whether the existing standard-setting regime for financial reporting – that of the US Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) – should be extended to include setting standards for nonfinancial information. Our work was informed by interviews we did with 50 experts in this field. We are grateful to them for taking the time to share their views with us.”

The members of the debate teams are as follows, and further details are available on this link.

• Chair: Lady Lynn de Rothschild
  
• In Proposition: Paul Druckman, Ian Mackintosh, Sir Callum McCarthy, Anne Simpson
  
• In Opposition: Jonathan Bailey, Bob Herz, Harvey Pitt, Tom Quaadman
  

This debate is free and open to the public. You can register to attend on this link.

Read the paper: Should FASB and IASB be responsible for setting standards for nonfinancial information?

The IIRC announced that  Dominic Barton appointed as Chair of International Integrated Reporting Council, as new strategic phase is launched. Barton was the Global Managing Partner from 2009 to 2018 at McKinsey & Company. He shared:

“I believe that through the adoption of integrated reporting internationally we can make real changes to the way businesses and our markets as a whole function. We can ensure that business is working for society, for the planet and for all stakeholders. That is why the first decision I made when stepping down from the global managing partner role at McKinsey was to join the IIRC as its Council Chair and I look forward to working with the team, as we launch this new momentum phase.”

Read the full announcement

Triple Pundit reported on a meeting held in late September at the US Aligning the SDGs with Integrated Reporting. IIRC President Richard Howitt explained how the SDG's can be integrated with other forms of reporting and commented on key indicators of progress in the integrated movement:

1. Release of the official position paper from the International Federation of Accountants (IFAC) that integrated reporting is “the future of corporate reporting” – no qualification, no conditions
   
2. Decision of the International Accounting Standards Board to Review its guidelines for the narrative part of the company report, partly to address integrated reporting
   
3. The recommendations of the High Level Expert Group on Sustainable Finance which called integrated reporting “the ultimate ambition,”
   
4. The financial standard-setters and the sustainability frameworks – SASB, CDP, the GRI and CDSB – which combine together in the “Corporate Reporting Dialogue” convened by the IIRC, agreed a joint position statement in favor of the TCFD recommendations

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The CPA Journal published a summary of a panel discussion Current Developments in the Private Sector featuring Bob Laux, U.S. Lead for the International Integrated Reporting Council. Bob outlined the basic perspective of the integrated movement and shared:

“I believe, and I could be wrong, that there’s a real movement, especially from chief executive officers at large U.S. companies, to change the conversation—to focus capital on the long term.” Integrated reporting, Laux said, “fits perfectly where CEOs and companies want to manage on a long-term basis and get out of this quarterly treadmill that has been so destructive to our long-term value creation.”

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This Sustainable Brands article The Corporate Reporting Dialogue (CRD) Is Looking for Alignment, Not for One Common Framework provides a great overview of the challenges of today's environment where there are many frameworks and systems that push beyond traditional financial reporting. Excerpts:

 All frameworks share the same purpose despite their differences: to facilitate better decision-making and long-term value creation – financial or “non-financial” – through transparency. The CRD is determined to better communicate how frameworks actually work together, identify overlaps, harmonize common reporting criteria like materiality, and align with SDGs as common founding principles. To this end, the CRD provides an online Landscape Map that shows how the frameworks are aligned and complement each other. Its members also published a Statement of Common Principles of Materiality, which guides companies on how materiality is similar between the participating frameworks.

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