Publication of IFAC Report, “Investor Demand for Environmental, Social and Governance Disclosures” – February 6, 2012

On February 6, 2012 the Professional Accountants in Business Committee of the International Federation of Accountants (IFAC) published the report, “Investor Demand for Environmental, Social, and Governance Disclosures.”

The report describes investors’ increasing demand for environmental, social and governance (ESG) disclosures.  It lists the types of disclosures and material information that interest investors.  Particularly useful is a chart of core, sector-neutral key performance indicators (KPIs) and metrics in each of the three areas.

Addressing its constituency, the IFAC report outlines the implications of this increasing demand for ESG disclosures on the accountancy profession and professional accountants in business.  “Professional accountants should be well placed to bring the discipline and application of accounting rigor to the collection, analysis, and reporting of ESG data, and to support the incorporation of ESG factors into an organization’s management processes and systems.” Five key recommendations provide guidance on how the accountancy profession should respond to increased investor awareness of and interest in ESG issues.  Finally, the report considers how companies and investors might consider the financial implications of ESG factors.

An executive summary and the entire report may be downloaded from the publications and resources section of the IFAC website.