Big Four accounting firms reveal ESG reporting standards

Leaders of the Big Four accounting firms have joined forces to unveil a reporting framework for environmental, social and governance (ESG) standards, it emerged this week.

In an article in the Financial Times published earlier this week, the Big Four - PwC, KPMG, EY and Deloitte - have all backed the framework, which has been headed up by the International Business School (IBS), run by Bank of America chief executive Brian Moynihan.

If successful, the initiative would mark the first truly co-ordinated approach to ESG reporting, prompting investors to move more money into the green economy.

"Right now, there is an alphabet soup of metrics," said Deloitte global chief executive Punit Renjen. "It is important for us to have a common set of standards and if there is widespread adoption it will lead to change in behaviour."

The Big Four and the World Economic Forum were invited to identify a set of universal ESG matrics and recommended disclosures that could be reflected in the mainstream annual reports of companies. The result of this process is 21 core metrics and 34 expanded metrics and disclosures, which IBS members are encouraged to adopt. 

The report, which has been seen by BusinessGreen's sister title Professional Adviser, outlines four pillars that firms can use to approach ESG reporting standards. These pillars include; principals of governance, planet, people and prosperity.

"Each of these pillars has an important bearing on the capacity of a firm to generate shared and sustainable value," the report states. "Performance in one pillar is highly interdependent with that in the others."

 

A version of this article originally appeared at Professional Adviser

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