Yesterday, the 8 October, took place the closed- door meeting organised by OIBR Foundation together with CSR Manager Network and Catholic University ALTIS, with the judge Prof. Mervyn E. King, a completely prominent and charismatic figure in the world of the sustainable development and of the non-financial information, famous for his range of codes of the listed South African of progressive nature and geared to sustainability (the so-called “King Codes”), Chair Emeritus of the Council of the International Integrated Reporting Council (IIRC), and Chair Emeritus of the Global Reporting Initiative (GRI), lawyer, judge, personal friend and direct collaborator of Nelson Mandela and of several Secretaries General of the UN.
Also Sara Cirone Group Benefit Society, founding member of the no-profit Foundation “Italian Organism of Business Reporting” (O.I.B.R.) (www.fondazioneoibr.it) attended the meeting with this very important international person who acts about management and sustainability issues. We report only some of the ideas Mervin King wanted to explore with the group present.
The 20th Century: an unsustainable development
According to the old business and managerial school of thought, the increase in welfare of the stakeholders in financial terms has been, for a few years, the main target of companies. This assumption has meant that the 20th Century has become a century of unsustainable development, with serious damages to the ecosystem and with the creation of serious and clear social and territorial imbalances.
But, in recent decades, a new view and conception of the role of the company in the world has spread. An increasingly oriented vision to a new humanism and a new idea of development which could be harmonious with respect to the environment and to the human rhythms.
So, at the beginning of 2000, is born the Global Reporting initiative (GRI), a non-profit entity whose function was to create a useful support for companies to report their own sustainable performance, i.e. 80% of the value that is not explained by the financial information. However, this step has not been conclusive and integrative, because the reporting system which was forming represented the companies as consisted of two components, which were complementary but disjoint among themselves: on one side the financial capital, on the other side the sustainability component. The overcoming of this paradigm happened in reaction to the demand of a reporting which incorporates all the variables of value creation, a reporting which can explain in an intelligible form the companies’ reality as a whole: the relationships with the stakeholder and the business capital are always integrated with each other.
This gradual change of mentality has given rise to the Integrated Report.
The Integrated Report as a means of knowledge and awareness
The Integrated Report is an innovative tool, it’s immediately understandable and it’s very useful because it enables the extension of the awareness to all the stakeholder regarding the process of value creation that the company helps. As well as it enables everyone to check how the company makes a contribution to the Sustainability, i.e. how the company protects the planet from the pollution, how the company uses in a responsible way the resources, how the company contributes to the welfare of people.
To integrate the sustainable thought to strategy
In a global context where million people die of hunger, water resources are under pressure, our planet is polluted and the resources are used in a unsustainable way, it’s primary, for our welfare and the future generations one, to learn how to cooperate, to find a shared system, so that these issues can be at the centre of the economic-productive-social system.
This is the role of the Integrated Report. Through a shared system, it shows the behaviour of the company, its way to create value, its way to “make money”, measuring also the impacts on Sustainability and suggesting solutions to remedy the negative ones.
So, it’s important to integrate the sustainable thought to its own strategy, because the plot we are coursing is the inclusive capital’s one and it is really important to let all the stakeholder know their own impact: the greatness of the Integrated Report is its central thought; if you don’t create value for the society, your business has to be reconsidered because you are risking the future of your children.
From shared value to olistic value
So, we need a change of mentality from the shared value, i.e. from the creation of shred value, thanks to operating policies and practices which increase the competitiveness of the company and, at the same time, improve the economic and social conditions inside the community where the company works, to the olistic value, an olistic view which considers economy-environment-society as an unicum, so that it’s possible to act all the actions and the management models of development which realise and promote the transition to Sustainability, in a vision which feeds the democratic participation, which manages, programs and controls the change in order to shape a sustainable future for our planet.
A deep reflection for companies
So, the framework of Integrated Report developed by International Reporting Council (IIRC) is very useful to realise this transition, because it’s useful not only to measure the transformation of the inputs in outcomes or output, but also because it leads the board and the managers to a deep reflection about the abilities of the company to add value to the society, to identify the major driver of value of the business, to determine with precision which are the main stakeholders of the company.
The Integrated Report: an advantage for everyone
So, it’s necessary to standardise the thought towards these issues. A raising awareness of the issue of the Sustainability and the implementation of the Integrated Report as “ guidance document” of the companies would be an advantage for everyone, because it would help to the welfare of communities, people and environment, and it would also lead to an improvement of the performances, considering that about sustainability important possibilities of development are involved.
About this, an important match is played for the development of each territory and also of the whole planet, for a possible future of our civilisation.