Integrated Reporting Framework

Hello Robin,

There is one thing in your discussion post that stood out for me and spurred curiosity that there are some movements towards developing standards for sustainability reporting and creating an “integrated reporting framework” that measures all aspects of a company including CSR and other non-financial metrics. In doing some research it seems that the Integrated Report is “designed to bring together all the material information about an organization’s strategy, governance, performance and prospects so that it reflects the commercial, environmental and social contexts in which the business works. It is also anticipated that the integrated reporting framework will bring about changes at the board level, to drive consistency between internal decision making and external reporting.” It appears that the integrated report provides some visibility about value creation over time derived from an organization’s strategy, governance, performance, and prospects in the short, medium, and long term.  

I believe the will help support the argument for funding for Corporate Social Responsibility efforts such as the ones expected from pharmaceutical companies. While many companies in the past have produced Corporate Social Responsibility (CSR) and sustainability reports along with the annual statements, there was historically limited linkage between these different outputs. These historical type of (ESG) environmental, social and governance disclosures were not conducive to mainstream use by investors, because as mentioned these reports typically lacked the clear links with the company's financial performance and long-term prospects for success.

It is believed that Integrated Reporting “would help the CSR and sustainability efforts by identifying asset categories that are not captured in current reporting, and the value aspects of the company. It should help put the concept of stewardship right at the heart of the corporate reporting system, which is particular importance to shareholders'.” I wonder if this new reporting framework that will help create some linkage between CSR type efforts and activities to a companies financials, help drive shareholders to see the value in CSR activities and promote the requirement for it to consistently be part of an organizations operational model increasing the opportunity for pharmaceuticals to take on such projects as reducing price or giving away AIDS medications in impoverished countries.