Since 2012, Peter Bakker, president of the World Business Council for Sustainable Development has been declaring that accountants will save the world. On January 12, I had the honor to host and moderate an expert panel on the subject in the most sustainable office building in the world.
Nyenrode University’s Dean, Mr. Leen Paape, opened the session from Nyenrode’s mission to educate responsible leaders. As a member of the jury for the Dutch government’s Transparency Benchmark, he contends that transparency is part of responsible leadership, as a process that drives accountability from companies and leaders. Even when sustainability reporting starts from compliance to demands from regulators or clients, the process itself has a positive effect. Multiple analyses show that transparent companies are led better and perform better. However, he is painfully aware that a good report does not guarantee good performance, as the recent scandals at the Dutch Railways and Volkswagen have shown.
Ms. Udeke Huiskamp, Senior Manager Sustainability at Deloitte, pointed to an increasing connection between financial and non-financial data. To report on non-financial topics, reporting standards are available, such as those from GRI, IIRC, and SASB. In order to compile a sustainability or integrated report, it is key that internal systems are in place. Accountants are perfectly placed to help with the creation of such information systems and internal controls on the accuracy and completeness of information. Increasingly, accountants are also requested to provide assurance on the non-financial content of annual reports. The reach and level of such assurance still varies widely, but is gradually improving over time. Expanding the audit services of accounting firms demands new skills from accountants. This requires training on specific sustainability topics, but also calls for enhanced skills on collaboration in multi-disciplinary teams.
For Ms. Carola Wijdoogen, Director of Sustainability at NS (the Dutch National Railways), accountants provide value by creating insight into performance by helping to define and measure the right KPIs, by offering standardization and credibility through international guidelines and assurance, and by providing access to the boardroom for the topic of sustainability. By working with accountants on the value creation model, based on integrated thinking, the NS is better able to tell its sustainability story. Accountants also supported the measurement of their impact on various material topics, enabling NS to much better weigh the impact and importance of various sustainability topics, and to engage with its diverse stakeholders in a much more fact-based manner.
Ms. Erica Kostense-Smit, manager sustainability at Deloitte, encouraged integrated thinking with a longer-term horizon. She shared Deloitte’s recent research on integrated reporting, highlighting the increase in integrated reporting in the Netherlands, but also the challenges that remain to integrate non-financial elements into strategy. She closed with a visual analogy, likening an integrated report to the visible part of an iceberg, supported by a much larger mass of integrated thinking.
After ample discussion among the speakers and with the audience, the conclusion was that accountants can certainly play a role in making companies more sustainable, but the profession is not quite ready to deliver on this promise without further education.
This event was part of series of events staged by the Nyenrode Alumni Circle for Sustainability, in this specific case in cooperation with the Alumni Circle for Accountancy & Control. It took place at Deloitte’s office in Amsterdam, which is currently both the most sustainable and the most connected office building in the world. For more information, watch Bloomberg’s inspiring video tour of the building.
Written by Marjolein Baghuis @mbaghuis. This post originally appeared in Dutch on Nyenrode’s alumni website.