Elliott - Chapter 32 - Sustainability - environment and social rep

Question 1

What does the Strategic Report explain?

Answer 1

This explains the business model, the objectives and strategies, the principal risks and how these are addressed and future prospects.

Question 2

What is the Integrated Reporting Framework?

Answer 2

This describes the capitals that a business might employ in achieving outputs from its business model.

• financial capital e.g. resources that it controls -net assets
• manufactured capital i.e non-current assets and finished goods
• Intelectual capital ie intangibles
• human capital ie way work is carried out
• social and relationship capital ie customer based intangibles such as key relationships
• natural capital ie renewable and non renewable environmental resources

Question 3

Environmental integrated financial reporting def

Answer 3

Reports started out as PR exercises are now gradually becoming valued by investors and analysts who are requiring a greater degree of detail. CSR and sustainability efforts important to stakeholders

Question 4

How does board composition affect environmental policy?

Answer 4

Female board members linked to positive environ performance.
Negative relationship between board members who have shown past unethical behaviour and enviro performance.
If share capital is provided by a select few, expenditure becomes far more personal and may result in a lack of environmental policy.

Question 5

Danger of information overload?

Answer 5

CSR can result in high data volume. Companies are overcoming this by issuing summary reports within annual reports etc. .

Question 6

What is the Connected Reporting Framework? CRF

Answer 6

Adopted by many organisations. Proposes five key environmental indicators, which all organisations should consider reporting: polluting emissions, energy use, water use, waste and significant use of other finite resources and industry benchmarks.

Question 7

What is the Global Reporting Initiative? GRI

Answer 7

Aimed to develop global sustainability guidelines for voluntary use. Covers: the economic dimension - financial and non-financial info - info on RnD investment in workforce etc.
The environmental dimension - adverse effects on air, water, land, biodiversity etc
The social dimension - health and safety, human rights etc.

Question 8

What is the Eco-Management and Audit Scheme? EMAS

Answer 8

Voluntary participation to promote continuous environment performance improvements of activities by committing organisations to evaluating and improving their own environmental performances.

Question 9

What is the international organisation for standardisation.?

Answer 9

Establish international standards to reduce barriers to trade. Companies may elect to join in order to obtain and ISO certification.
Benefits are:
Top level management become involved: define and overall policy
Environmental Management - framework for environ management.