The legislative process behind the UK’s review on the future of narrative reporting has come to a new milestone with the publication on 18th of October of draft regulations.While this is only a consultation draft, from October 2013 we’ll probably be saying so long to the ‘business review’ and hello to the ‘separate strategic report’.
As expected, the regulations require British registered companies to report for the first time ‘on any human rights issues’. In addition quoted companies will now be asked to report on diversity as well as the existing requirements of environmental matters, company employees, and social and community issues. While this could be construed as mandatory sustainability reporting through the back door the level of disclosure required is only“…to the extent necessary for an understanding of the development, performance or position of the company’s business…”
The inclusion of diversity information is especially welcome. Specific reporting requirements are; the number of men and women on the board, in the whole organisation and in senior executive positions (defined as “a person in authority and responsibility for planning, directing and controlling the activities of a company and is an employee of that company). However while these regulations add in many important respects, in some ways they reduce sustainability disclosure. Some will find it surprising that the draft legislation removes the requirement for companies to disclose the number and purpose of charitable contributions of over £2000. There’s still time to add your thoughts on the draft, but don’t delay, consultation closes on 15th November.