International Integrated Reporting Council

Definition

The International Integrated Reporting Council (IIRC) is a global coalition of regulators, investors, companies, standard setters, and NGOs that aims to create a framework for integrated reporting. This framework promotes a holistic approach to corporate reporting, combining financial and sustainability information to reflect an organization's strategy, governance, performance, and prospects in a way that provides a comprehensive view of value creation over time.

5 Must Know Facts For Your Next Test

1. The IIRC was established in 2010 to develop and promote the adoption of integrated reporting worldwide.
2. The Integrated Reporting Framework developed by the IIRC is designed to improve the quality of information available to investors and other stakeholders.
3. One of the main goals of the IIRC is to enhance the accountability and stewardship of organizations towards the broader context in which they operate.
4. The framework encourages organizations to focus on long-term value creation rather than just short-term financial performance.
5. The IIRC collaborates with various international organizations to ensure the integrated reporting framework aligns with other reporting standards and practices.

Review Questions

• How does the International Integrated Reporting Council contribute to the development of integrated reporting practices among organizations?
  • The International Integrated Reporting Council plays a pivotal role by developing a framework that encourages organizations to combine financial and non-financial information in their reports. This framework helps businesses communicate their strategy, governance, and performance in a way that reflects their value creation process over time. By providing guidelines and best practices, the IIRC promotes greater transparency and accountability, ultimately improving the quality of information available to investors and stakeholders.
• Discuss how integrated reporting can improve stakeholder engagement and decision-making for organizations.
  • Integrated reporting improves stakeholder engagement by providing a more complete picture of an organization's performance, including its sustainability efforts. By incorporating non-financial metrics alongside financial results, companies can better communicate their long-term strategies and value creation processes. This transparency allows stakeholders, including investors, customers, and employees, to make more informed decisions based on a holistic understanding of the organization's impact and goals.
• Evaluate the implications of adopting integrated reporting frameworks on corporate governance and strategic planning within organizations.
  • Adopting integrated reporting frameworks has significant implications for corporate governance and strategic planning as it requires organizations to align their operational objectives with broader sustainability goals. This alignment fosters a culture of accountability and transparency within the organization, encouraging management to consider long-term impacts in their decision-making processes. Moreover, integrating sustainability into corporate strategy can enhance risk management practices and identify new opportunities for value creation, ultimately leading to improved performance and stakeholder trust.

Related terms

Integrated Reporting: A process that results in communication, most visibly through an annual report, about value creation over time. It integrates financial and non-financial information into one cohesive report.

Sustainability Accounting Standards Board (SASB): An independent nonprofit organization that provides sustainability accounting standards that help public corporations disclose material sustainability information to investors.

Corporate Social Responsibility (CSR): A business model in which companies integrate social and environmental concerns into their operations and interactions with stakeholders.