First paper draws on 10 bodies across 180 countries

Australia’s largest entities are publishing their first climate-related disclosures as a new Global Accounting Alliance report calls for stronger links between sustainability reporting and financial reporting.

Chartered Accountants Australia and New Zealand contributed to the report, which is the first paper in the alliance’s three-part Connectivity in Reporting series. The Global Accounting Alliance said the paper explores how organisations can better connect financial and sustainability information to support decision-making, transparency and long-term value creation.

The report draws on the views of 10 accounting bodies that represent more than 1.4 million accountants across 180 countries. It also uses insights from more than 30 interviews across the reporting ecosystem.

According to the alliance, the first report explains why connected reporting is becoming a hallmark of high-quality, decision-useful information. That work comes as organisations face new climate reporting requirements and rising expectations from investors, regulators and other stakeholders for clear and consistent information.

CA ANZ chief executive Ainslie van Onselen said organisations could no longer afford to treat financial and sustainability reporting as separate exercises. “Financial information and sustainability information should tell the same story,” Ms van Onselen said.

She said climate-related risks and opportunities can affect cashflows, asset values, access to capital and long-term performance. As a result, organisations that combine those insights are better placed to explain their strategy, resilience and prospects to investors and other stakeholders.

Three-part series moves to governance guidance

The report lists practical ways organisations can strengthen links between sustainability-related and financial information. It also sets out the benefits of a more integrated approach to reporting.

Global Accounting Alliance chief executive Jim Knafo said, “Connectivity is becoming one of the defining features of high-quality corporate reporting.”

Knafo said expectations for sustainability-related information were rising, while professional accountants could help make reporting more coherent, reliable and useful. He said the series aims to support the profession in telling a more connected story about performance, risk and long-term value.

Meanwhile, the three-part series will move from concepts and emerging trends to governance considerations and then practical implementation guidance. Those later papers are intended for organisations seeking to strengthen connected reporting.

The Global Accounting Alliance is an alliance of 10 professional accounting bodies from around the world, including Chartered Accountants Australia and New Zealand. CA ANZ welcomed the report as Australian organisations begin reporting under the new climate disclosure regime.