ACCA President’s debate “Accounting for Public Goods: the Social and Natural Capital Imperatives”
EU and global stakeholders discussed the vital next steps to further embed natural capital and social considerations in business decision making during ACCA’s President Debate in Brussels
Social and Natural Capital imperatives are increasingly seen as potentially material issues that businesses of all types and investors should manage and quantify, panelists at ACCA’s President's Debate agreed. However, they also stated that these goals are not easy tasks to achieve, debating that when accounting for natural capital, the focus is often on ecosystem services and the challenges associated with their valuation, but the valuation of biodiversity has proved even more challenging.
Given this scenario, it is therefore time to have a bold discussion to concretely address challenges and define the next steps to further embed natural capital and social considerations in business decision making.
This was precisely the aim of the new edition of ACCA’s President’s Debate for 2017, called “Accounting for Public Goods: the Social and Natural Capital Imperative
s”. It brought together policymakers, investors, landmanagers, businesses, natural capital specialists and accountancy professionals to discuss how accounting can help integrate the values and services of nature into economic decision making, and how can it support businesses to make more sustainable choices.
Brian McEnery, ACCA President said : “The growing interest in the concept of natural capital is already driving a wide range of initiatives aimed at developing tools and frameworks for accounting and reporting, as illustrated in ACCA’s recent paper called Natural Capital and the Accountancy Profession. But we need to do more, and a meaningful measure must be found to incorporate biodiversity in the process.
Part of the answer to addressing our natural capital crisis lies with the accountants. Not only can members of our profession help to develop solutions, but perhaps it is time for us to embed their concrete application and to assume the responsibility of accounting for business’ use of natural capital”, Brian McEnery added.
Phil Hogan, EU Commissioner Agriculture and Rural Development said in his keynote speech: “We all agree that agriculture plays a key role in the provision of measurable global public goods and the safeguarding of natural capital. Further policy action is needed to strengthen the ability of farmers and landmanagers to generate these public goods. But the devil is in the detail: it is always very nice to talk about public goods, but it is worth asking what exactly this means? How can we measure their value and how can we all contribute to their provisions? ACCA has addressed these essential questions in his paper on Accounting for Natural Capital; I am convinced that accountancy can contribute to attaching a value to Natural Capital.”
The debate confirmed and asserted that the world is facing sustainability issues on a global scale. Biodiversity loss and ecosystem collapse is ranked as a highly likely risk with high impact in the 2017 World Economic Forum's Global Risks Report. Natural capital accounting should help better manage these risks. It was stressed that tackling the ecological crisis of today is not only an ethical issue - preserving the variety and abundance of life on earth is also an economic imperative. More and more companies are striving to understand how their activities impact, and depend on biodiversity, and how to become more sustainable. Governments, for their part, need to factor in how natural capital contributes to growth.
Maggie Mc Ghee, ACCA Director of Professional Insights concluded: “We heard from speakers that a key dimension for corporate private accounting systems is the need to be simple enough for businesses to use, and the need to be relevant, to pass the 'materiality test' and the need to be based on data that are available. We also heard that public accounting of natural capital faces similar challenges: the need for a common metric and the challenge of data availability. As mentioned by Humberto Delgado Rosa, Director of Natural Capital at DG Environment, there is a clear scope for learning from each other and benefits in further cooperation and sharing best practice.”
Other speakers at ACCA’s President’s debate included:
· Corrado Pirzio-Biroli, CEO of the RISE Foundation
· Eva Mayerhofer, Lead Environment and Biodiversity Specialist, European Investment Bank
· Michel Bande, Senior Executive Vice-President, Solvay
· Humberto Delgado Rosa, Director, Natural Capital, DG ENVI, European Commission
The second President’s Debate of 2017 will be held in Dublin in June 2017.
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Notes to Editors
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. It offers business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
ACCA supports its 188,000 members and 480,000 students in 181 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 95 offices and centres and more than 7,110 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.
Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. It believes that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. ACCA’s core values are aligned to the needs of employers in all sectors and it ensures that through its range of qualifications, it prepares accountants for business. ACCA seeks to open up the profession to people of all backgrounds and remove artificial barriers, innovating its qualifications and delivery to meet the diverse needs of trainee professionals and their employers. More information is here: www.accaglobal.com