1. 9/4/20151 WELCOME CORPORATE REPORTING & SOCIAL RESPONSIBILITY: A STUDY OF SUSTAINABILITY REPORTING Prof. Ranjan K. Bal Prof. Ranjan K. Bal Utkal University Utkal University

2. 9/4/20152 CUSTOMER IS THE KING. DELIGHT OUR CUSTOMERS.  Who are the customers of Accountants ?  Challenge before the Accountant: To delight your customers

3. 9/4/20153 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. 9/4/20154 POST ENRON ERA  Trust-Transparency gap  Information provided Vs. Information needs of Stakeholders. Osama Bin Laden wanted to become an accountant !!

5. 9/4/20155 CORPORATE REPORTING  Trust-me Culture  Tell-me Culture  Show-me Culture

6. 9/4/20156 MYTHS REGARDING MYTHS REGARDING CSR  A drain on profit -Contradicts the main objective -Contradicts the main objective  A charitable work  Don't contribute to the best interest of the corporation

7. 9/4/20157 CSR  A business process: Decision making-Sensitive about the effects on society  Stakeholders: Society & Community  Wealth creators Vs. Wealth distributors  Mutual beneficial partnership  An investment by the Corporation

8. 9/4/20158 ACTIVITIES BY SOME ORGANISTIONS CSR ACTIVITIES BY SOME ORGANISTIONS  Bank of India: To adopt 101 villages  NABARD: Develop rural non-firm sector  HPCL: Rasoi Ghar, Hamara Pump, Leadership lectures  ICICI Bank: Partnering with NGOs, Capacity building  BPCL: Infrastructure Development, Healthcare

9. 9/4/20159 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. 9/4/201510 SUSTAINABLE DEVELOPMENT  Meets the needs of present generation  Without compromising the ability of future generations  Minimum environmental impact  Maximum value addition for customers

11. 9/4/201511 Research Findings: KPMG study: On “Measuring Performance of the Organizations of the Future” 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. 9/4/201512 RESEARCH FINDINGS  McKinsey & Co: 400 Firms “The environmental challenge is one of the central issues of the 21 st century.” “The environmental challenge is one of the central issues of the 21 st century.”  World Economic Forum: 650 Executives “Environment is the most important challenge affecting business.” “Environment is the most important challenge affecting business.”

13. 9/4/201513 Social Economic Environmental Triple Bottom Line

14. 9/4/201514 TBL or Sustainability Reporting  Framework for measuring business performance  Single bottom line to Triple bottom line  Shareholder-oriented accounting to Stakeholder-oriented accounting Stakeholder-oriented accounting  3 Ps: Profit, Planet & People TBLR is complementary to Financial Reporting. TBLR is complementary to Financial Reporting.

15. 9/4/201515 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. 9/4/201516 ENVIRONMENTAL BOTTOM LINE  Efficient use of natural resources  Efficient environmental mgt.  Renewable natural capital

17. 9/4/201517 ECONOMIC BOTTOM LINE  Economic profitability  Employment generation  Market creation  Financial capital & Physical capital

18. 9/4/201518 WHY ? 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. 9/4/201519 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. 9/4/201520 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 9/4/201521

22. INITIATIVES  GRI (Global Reporting Initiatives) (www.globalreporting.org) (www.globalreporting.org)www.globalreporting.org  A4S (Accounting for Sustainability Project) (www.accountingforsustainability.org) (www.accountingforsustainability.org)www.accountingforsustainability.org  IIRC (International Integrated Reporting Committee) (www.theiirc.org) (www.theiirc.org)www.theiirc.org 9/4/201522

23. IMPLICATION FOR FINANCIAL MANAGERS  In the areas of investor relations/PR  Telling a Co’s financial story = Telling the Co’s sustainability story 9/4/201523

24. 9/4/201524 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. 9/4/201525 CHANGE Change is the only constant in to-day’s world. “A company can not survive without change.” K.V.Kamath

26. 9/4/201526 “Earth provides enough to satisfy everyone’s needs, but not everyman’s greed.” -GANDHIJI

27. 9/4/201527 DISTINCT or EXTINCT “ACT NOW or GET READY TO BE A PART OF HISTORY.” THANK YOU