The world is changing under the influence of globalization, a rapid shift in the development of technology, uneven changes in the population and excessive pressure on the environment due to an increase in the consumption of natural resources. In those terms, the integrated reporting model appeared the only tool for obtaining complete information about the activities of corporations because it reflects the risks of activities and combines financial and non-financial indicators for business analysis. Integrated reporting also performs a social function, which is expressed in the fact that it helps society to supervise business activity and respond to changes around, primarily in the form of a transformation of the economic model.
Sustainability reporting for large public companies around the world should become the norm. A key feature of integrated reporting is that its overall reporting helps to develop a more coherent and efficient approach to corporate reporting. Its goal is to improve the quality of information available to providers of financial capital in order to ensure more efficient and productive allocation of capital.
The main purpose of the article is to study the history of the emergence of integrated reporting, research and understand its essence and the importance.
In developed countries, the first integrated reports began to appear in the mid-2000s. They were formed according to the requirements of sustainable development concepts. The International Integrated Reporting Council (IIRC), which introduces integrated thinking into business practice, in particular the analysis of the relationship between operating and functional units and the capital used by the company in its activities, was founded in 2010. It is a global coalition of representatives from the International Financial Reporting Standards Board, the US Financial Accounting Standards Committee, the International Federation of Accountants and international development institutions, audit and consulting companies, expert organizations and real sector companies. The main thing is that the coalition is implementing a global initiative: the introduction of a new type of reporting, which is integrated. They consider it a good practice of implementing the concept of sustainable development into business. In 2013, the draft Standard of an Integrated Report was released. It defined the concept and content of integrated reporting, leading principles, fundamental concepts and content elements. Thus, when forming integrated reporting, corporations must disclose financial and non-financial information so that users of this information (society) can comprehensively assess their activities.
However, each corporation can choose its own system of indicators, which depend on the type of economic activities and the preferences of the corporation's management. However, the most important thing is that the indicators must meet the expectations of stakeholders. An integrated report must be linked to other reports that are required by a particular stakeholder. There is a clear trend among investors that they tend to see more and more non-financial data.
In Turkey, issues of creating integrated reporting are under the control of corporate managers. The results of the study show that it is necessary to encourage corporations to spread the practice of creating integrated reporting. A survey of Turkish companies that prepare integrated reporting showed a number of such advantages:
- 72% reporting gains in productivity;
- 56% accessing a lower cost of capital;
- 92% finding benefits in linking environmental, social and governance data with financial data;
- 96% considering their capitals more extensively, beyond the financials;
- 96% creating an integrated mindset that allows for the company to evaluate its long-term sustainability.
In Ukraine, the prerequisites have already been created for the implementation of integrated reporting as a tool for socially responsible business, which provides information on the impact of the company's activities on the development of society, the economy and the environment.
Thus, it was revealed that the interest in integrated reporting (reporting for evaluating the sustainable development goals’ achievement) is currently growing. Globally, more than 11,000 corporations, united by a common interest in integrated reporting, have prepared more than 55,000 reports that can be classified as integrated.
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