week 2

• Sustainability


  Development that meets the needs of the present without compromising the ability of future generations to meet their own needs
• Sustainability


  • Focuses on how a company manages its economic, environmental and social impacts, risks and opportunities
  • Disclosure on these non-financial matters is done through sustainability reporting
• Sustainability reporting


  An organization's practice of reporting publicly on its significant economic, environmental and/or social impacts, in accordance with globally accepted standards
• Sustainability reporting benefits stakeholders interested in an organization's ability to create value over time, including employees, customers, suppliers, investors, business partners, local communities, legislators, regulators, and policy makers
• Sustainable development as a concept was launched

  Late 1980s
• Sustainability recognizes the interdependence of economic, social and environmental factors
• Sustainability is also forward-looking with reference to future generations
• There is increasing interest in developing new welfare indexes, such as the creation of gross happiness indexes, originally invented in Bhutan
• Environmental accounts have been created to complement national financial accounts, by detailing the full economic costs of natural resources used and environmental effects caused
• Corporate decision-making is often heavily reliant on financial information, although this information may not give a complete picture about an organization and the environment in which it operates
• Environmental and sustainability issues are not only a moral concern, but are increasingly important because of their financial significance
• In the late 1980s, the first voluntary environmental reports were published
• Since the mid-1990s, sustainability reporting has developed in various directions, including corporate social responsibility (CSR) reporting and triple bottom line (TBL) reporting
• The Global Reporting Initiative (GRI) has developed a voluntary sustainability reporting framework
• The UN's Global Compact encourages businesses worldwide to adopt sustainable and socially responsible policies and to report on their implementation
• The OECD has Guidelines for Multinational Enterprises that are recommendations to governments, aimed at providing voluntary principles for responsible business conduct
• The ISO 26000 guidance for social responsibility was launched in 2004 to contribute to sustainable development
• The growing concern about climate change has made carbon reporting more popular, such as the Carbon Disclosure Project
• In the Philippines, less than 22% of publicly-listed companies have published a report on sustainability impacts and performances
• The SEC included Principle 10 in the Code of Corporate Governance for Publicly Listed Companies (PLCs) stating that companies should ensure that material and reportable non-financial and sustainability issues are disclosed
• The SEC formally launched the Sustainability Reporting Guidelines for Publicly Listed Companies (PLCs) during the SEC-PSE Conference on Building a Sustainable Business Community
• Sustainability reporting


  The disclosure of non-financial and sustainability issues by companies
• The Securities and Exchange Commission (SEC) encouraged the corporate sector to integrate sustainability in their business practices
• The SEC formally launched the Sustainability Reporting Guidelines for Publicly Listed Companies (PLCs)
• SEC Chairperson Emilio B. Aquino: 'With the issuance of the Sustainability Reporting Guidelines, your SEC has high hopes that PLCs would not only be made aware of sustainability but would make it a part of their priorities. We hope we would all be reminded that the responsibility of creating a sustainable environment is an obligation so basic and imperative that it precedes any kind of law. It is a call for the preservation of humankind, of our generation and of the generations to come.'
• PSE President Ramon S. Monzon: 'Companies have the inherent responsibility to take care of human, social and environmental capitals.'
• SEC's Action Plan on Sustainability Reporting


  1. Creation of a Technical Working Group

  2. Strict Monitoring of SR Submissions

  3. Strict Imposition of Penalty for Non-Submission of SR

  4. SR Workshops Conducted by the SEC

  5. Issuance of SEC Memorandum Circulars

  6. Coordination with Different Market Groups on Sustainability Reporting
• Benefits of Sustainability Reporting

  • Identification Effective management of sustainability risks and opportunities
  • Sustainable Vision, Strategy and Business Plans
  • Improved management systems
  • Motivated workforce
  • Investor attractiveness
  • Improved company reputation and brand value
  • Stakeholder Engagement
  • Competitive Advantage
• Professional accountants in business

  Accountants working in commerce, industry, financial services, education, and the public and not-for-profit sectors who undertake diverse roles in leadership and management, operations, management control and stakeholder communications
• Accountants have historically provided stewardship of an organization's assets and been responsible for sound financial management and reporting
• Accountants are increasingly taking on a broader stewardship role, helping organizations respond to uncertainty, improve decision making, and identify new business opportunities, and innovative processes, products, and services
• Sustainability needs to be measured, reported and assured, and all these areas fall under accountants' remit
• Accountants have an important role to play in helping companies embed sustainability into their corporate strategies
• Accountants can help develop a credible standard of sustainability reporting in organizations where it is yet to be adopted
• Accountants must be prepared to acquire new skills in developing verifiable non-financial measures and enhancing estimation techniques and forward planning for sustainability issues
• Practice clients now expect their accountants to be 'trusted business advisers', including on the issues of corporate sustainability, rather than just 'number-crunchers'