Reporting plays a key role in business, allowing you to see what has happened. What has worked and how different activities have interacted. Reporting also often predicts what is likely to happen in the future and provides the key to foresight. Reporting has been one of the guiding and central elements in the work on accountability, defining the whole accountability process. The importance of sustainability reporting is increasing with the new sustainability legislation, which obliges large companies to report on their own and their suppliers’ sustainability performance in much greater depth than before.
Sustainability reporting is also currently being carried out, for example in accordance with the UN definition of the Sustainable Development Goals or the GRI, the ‘global reporting initiative’ model and its principles. In 2015, the UN adopted the Sustainable Development Goals (SDGs), a universal call to action to eradicate poverty, protect the planet and ensure that by 2030 all people can enjoy peace and prosperity.
The European Commission has recently published proposals for corporate responsibility legislation that will come into force from the start of the 2025 financial year. The change will affect an estimated 700 companies in Finland. The change will apply to listed companies (excluding micro-entities) and companies that meet two of the following three conditions: at least 250 employees, at least €40 million turnover or at least €20 million balance sheet. From the 2025 financial year, these companies will have to act responsibly on the issues covered by the proposal and report in accordance with the new statutory corporate sustainability reporting standard.
The role of reporting
Companies often have to comply with standards and related management review reporting. The purpose of these reports is to determine whether management systems are working as intended and producing the desired results as effectively as possible. It is an ongoing “due diligence” review by management to fill the gap between day-to-day work and regular formal audits. Power BI or similar ‘business intelligence’ reporting may also be used, which refers to the process and technical infrastructure that collects, stores and analyses the information generated by a company’s activities. BI is a broad term covering data mining, process analysis, performance benchmarking and descriptive analytics.
With the development of different reporting models, and the combination of these, it is becoming easier to facilitate and build more and more up-to-date accountability reporting. In the future, there will be a strong convergence between different reporting formats, such as risk and quality management, compliance and sustainability reporting. Combining these reports will make it easier for management to obtain up-to-date information on operations on a continuous basis, while linking to financial management.
Reporting is also strongly linked to strategy work and the implementation of the company’s strategy. In particular, sustainability issues are increasingly linked to the company’s values, objectives and strategy. While sustainability reporting needs to be comprehensive, it is also a key element of strategy; it needs to be relevant, accurate and up-to-date.
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