Endnotes
1 G Tett. Business face stern test on ESG amid calls to ‘build back better’. Financial Times, 18 May 2020. (Accessed 9 June 2020).
2 J Elkington, Green Swans: The Coming Boom in Regenerative Capitalism (Fast Company Press, New York: 2020) p.149. Future-Fit Foundation, Methodology Guide: What the Benchmark is, Its Scientific Foundations, How it was Developed (April, 2019) p.12. (Accessed 9 June 2020). PwC, Mind the Gap: The Continued Divide Between Investors and Corporates on ESG (June, 2020) p. 5. (Accessed 9 June 2020).
3 WEF, The Global Risks Report 2021 (January, 2021). (Accessed 19 January 2021).
4 WEF, The Global Risks Report 2021 (January, 2021).
5 CGMA, Creating a sustainable future: The role of the accountant in implementing the Sustainable Development Goals. (London: April 2018). (Accessed 9 June 2020).
6 Make the SDGS a Reality (Accessed 9 June 2020).
7 Sustainability Accounting Standards Board (SASB) standards (Assessed 9 June 2020); Global Reporting Initiative (GRI) standards (Accessed 9 June 2020). World Economic Forum (WEF) consultation draft, ‘Toward Common Metrics and Consistent Reporting of Sustainable Value Creation’ (Accessed 9 June 2020).
8 TCFD, Recommendations of the Task Force on Climate-related Financial Disclosures (June, 2017). (Accessed 16 November, 2020).
9 In May 2020, the Canadian federal government announced that large businesses affected by the COVID-19 pandemic and applying for emergency loans must publish annual climate disclosure reports. This applies to businesses with revenues above $300 million CAD. The loan requirements explicitly refer to the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), and requires applicants to link their corporate reporting to other environmental sustainability goals. The Canadian government clearly is linking COVID-19 stimulus packages with the building of sustainable and resilient businesses. N Degnarain. What Canada is getting right with its Covid-19 economic response plan. Forbes, 19 May 2020. (Accessed 4 June 2020).
In September 2020, the New Zealand Government announced their intension to implement mandatory climate reporting in line with the TCFD recommendations. If approved by New Zealand’s Parliament, financial entities with assets over 1$billion, including registered banks, credit unions, building societies, managers of registered investment schemes, licensed insurers, equity and debt issuers, and, crown financial intuitions, will from 2023 be required to make climate related disclosures. C Graham-Mclay, ‘New Zealand minister calls for finance sector to disclose climate crisis risks in world first’. The Guardian (London) 15 September 2020. (Accessed 16 November 2020).
Greater climate-related financial disclosure is also a goal of the United Kingdom’s Government. In a November 2020 statement, the UK’s Chancellor of the Exchequer set out his government’s intention to make TCFD- aligned disclosure fully mandatory across the economy by 2025, with a significant portion of the requirement in place by 2023. HM Treasury, Interim Report Interim Report of the UK’s Joint Government-Regulator TCFD Taskforce (November, 2020). (Accessed 16 November 2020).
10 By the end of 2020, countries which have built net zero carbon targets into legislation include, 2045 – Sweden, 2050 – Denmark, France, Hungary, Japan, South Korea, United Kingdom, 2060 – China. (Accessed 6 January 2020).
11 G Thunberg, No One is too Small to Make a Difference (London, 2019). p.64.
12 PCAF (2020). The Global GHG Accounting and Reporting Standard for the Financial Industry. First edition. (November 18, 2020). p.107. (Accessed 19 January 2021).
13 A Carrillo Pineda & P Faria, Towards a Science-Based Approach to Climate Neutrality in the Corporate Sector (Science Based Targets and CDP, 2019). p.14. (Accessed 19 January 2021).
The Carbon Trust also cite the Science Based Targets Initiative (SBTi) who are working towards achieving this with a company working definition. ‘A net zero company will set and pursue an ambitious 1.5°C aligned science-based target for its full value-chain emissions. Any remaining hard-to-decarbonise emissions can be compensated using certified greenhouse gas removal.’ (Accessed 7 January 2021).
14 M Berners-Lee, How Bad are Bananas? The Carbon Footprint of Everything (Profile Books, London: 2020). p. 7.
15 Guidance: Streamlined Energy and Carbon Reporting (SECR) (Accessed 20 January 2021). SECR explained: Streamlines Energy and Carbon Reporting framework for UK business (Accessed 20 January 2021).
16 Climate Change Laws of the World (Accessed 20 January 2021).
17 P. Dasgupta, The Economics of Biodiversity: The Dasgupta Review. (London: HM Treasury, 2021). p. 501. (Accessed 10 February 2021).
18 Dasgupta, The Economics of Biodiversity. p.501.
19 Aichi Biodiversity Targets. (Accessed 8 December 2020).
20 Aichi Biodiversity Targets. (Accessed 8 December 2020).
21 The UK Government, in August 2020, launched a consultation on proposed new legislation to protect rainforests and clean up supply chains. (Accessed 14 December 2020).
22 Based on a lecture given by Jan Bebbington, Professor of Accounting and Sustainable Development, Birmingham Business School entitled, ‘The Anthropocene, Corporate Biosphere Stewardship, The Keystone Actors, and, Inter-Disciplinary Scholarship’. Given at the Management Accounting Research Group (MARG) conference, at Aston University on 15 November 2019.
23 S Shah, The Next Great Migration: The Story of Movement on a Changing Planet (Bloomsbury, London: 2020). p.243.
24 CGMA, Re-inventing Finance for a Digital World: The Future of Finance (January, 2019).p.12.
25 J Atkins & B Atkins (Ed), The Business of Bees: An Integrated Approach to Bee Decline and Corporate Responsibility (Routledge, Abingdon: 2017). p.179.
26 D Omand, How Spies Think: Ten Lessons in Intelligence (Penguin, London: 2020). p. 4.
27 Atkins & Atkins, The Business of Bees. p.182.
28 Omand, How Spies Think. p.223.
29 WEF, The Global Risks Report 2021 (January, 2021). p.87.
30 WEF, The Global Risks Report 2021 (January, 2021). p.13.
31 C Bergstorm & J West. Calling Bullsh*t: The Art of Scepticism in a Data-Driven World (Allen Lane, London: 2020). p. 62.
32 Bergstorm & West. Calling Bullsh*t. p. 83.
33 D Epstein, Range: How Generalists Triumph in a Specialized World (London, 2019). p.264
34 CIMA, The Global Management Principles (December 2015).
35 CGMA, Re-inventing Finance for a Digital World. p.14.
36 CGMA, Re-inventing Finance for a Digital World. p.14.
37 J Elkington, Green Swans.p.30.
38 L Acaroglu, Tools for Systems Thinkers: The 6 Fundamental Concepts of Systems Thinking (7 September, 2017). (Accessed 25 January 2021).
39 Bergstorm & West, Calling Bullsh*t. p. 206.
Dr. Martin Farrar Associate Technical Director Research and Development — Management Accounting
Association of International Certified Professional Accountants
AICPA is the world’s largest member association representing the accounting profession, with more than 418,000 members in 143 countries and a 129-year heritage of serving the public interest. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting.
The AICPA sets ethical standards for the profession and U.S. auditing standards for audits of private companies, not-for-profit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination and offers specialty credentials for CPAs who concentrate on personal financial planning; fraud and forensics; business valuation; and information technology. Through a joint venture with The Chartered Institute of Management Accountants (CIMA), it established the Chartered Global Management Accountant (CGMA) designation to elevate management accounting globally. The AICPA maintains offices in New York, Washington, DC, Durham, NC, and Ewing, NJ. aicpa.org
CIMA founded in 1919, is the world’s leading and largest professional body of management accountants, with members and students operating in 177 countries, working at the heart of business. CIMA members and students work in industry, commerce, the public sector and not-for-profit organisations. CIMA works closely with employers and sponsors leading-edge research, constantly updating its qualification, professional experience requirements and continuing professional development to ensure it remains the employers’ choice when recruiting financially trained business leaders. cimaglobal.com
For information about obtaining permission to use this material other than for personal use, please email copyright-permissions@aicpa-cima.com. All other rights are hereby expressly reserved. The information provided in this publication is general and may not apply in a specific situation. Legal advice should always be sought before taking any legal action based on the information provided. Although the information provided is believed to be correct as of the publication date, be advised that this is a developing area. The Association, AICPA and CIMA cannot accept responsibility for the consequences of its use for other purposes or other contexts.
The information and any opinions expressed in this material do not represent official pronouncements of or on behalf of the AICPA, CIMA, or the Association of International Certified Professional Accountants. This material is offered with the understanding that it does not constitute legal, accounting, or other professional services or advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought.
The information contained herein is provided to assist the reader in developing a general understanding of the topics discussed but no attempt has been made to cover the subjects or issues exhaustively. While every attempt to verify the timeliness and accuracy of the information herein as of the date of issuance has been made, no guarantee is or can be given regarding the applicability of the information found within any given set of facts and circumstances.
aicpa.org | aicpa-cima.com | cgma.org | cimaglobal.com
Founded by AICPA and CIMA, the Association of International Certified Professional Accountants powers leaders in accounting and finance around the globe. © 2021 Association of International Certified Professional Accountants. All rights reserved. 2102-44663