70% of CFOs do not report non-financial outcomes

Less than 30% of financial directors of Irish companies report on non-financial measures such as social and environmental impacts as part of their reporting cycle; despite pending EU legislation requiring such coverage.

The information formed part of the latest quarterly Deloitte/Business in the Community Ireland CFO [chief financial officer] survey, covering the second quarter of 2012.

Overall, the survey found 90% of CFOs believe there to be a direct link between sustainability programmes and business performance. Respondents said sustainability has the strongest impact on long-term value creation, compliance, risk management and building trust. Nearly 60% of respondents said they feel it is important to have sustainability programmes forming part of a CFO’s role.

Sustainability, along with non-financial reporting, is likely to become increasingly important as the EU is currently progressing legislation requiring non-financial reporting by CFOs.

“Sustainability and non-financial reporting are becoming increasingly important in today’s marketplace as a means of driving value,” according to Deloitte’s Ciaran O’Brien.

“Whereas, traditionally, many companies believed that sustainability issues fell within the remit of various functions including HR, marketing or investor relations, Irish CFOs are now aware of the benefits of driving these programmes. Increasingly, stakeholders such as investors, customers and employees are expecting organisations to meet standards of social, environmental and economic performance, the so-called triple bottom line,” he added.

“Today’s CFO is tasked with sustaining the enterprise as opposed to the environment. However, viewing the CFO’s role through the sustainability lens ensures that the long-term economic viability of the organisation, as well as a balanced view of social and environmental impacts, is considered.

“This research shows that CFOs believe there is a direct link between sustainability and business performance yet less than 30% of companies report on it in their annual reports. This has to change if we are to restore trust in business, drive competitiveness and make Ireland a great place to do business,” Business in the Community’s chief executive, Tina Roche added.