KPMG ROMANIA SRL

  |  25.10.2017

The road ahead: Romanian companies need to make swift and sustained steps to catch up with worldwide leaders on corporate responsibility reporting

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CR reporting in Romania


The research on Romania’s top 100 companies by revenue (N100) shows a slight increase in the number of companies reporting on sustainability. More specifically, 74 of the N100 disclose sustainability related information – either in a local report or by providing data for a CR Group report – marking a 6 percent increase by comparison with the 2015 edition of the survey.

According to the results of this latest survey which are based on analysis of reports launched in the period 2015-2017, out of the total of 74 companies disclosing sustainability data, 35 report information on their CR practices and performance exclusively via the parent company or within the Group report, 30 subsidiaries of multinationals operating in Romania publish sustainability information on their local website and only 9 Romanian private or state-owned firms publicly communicate this data.

 

The key findings related to the reporting practices of the 39 companies locally disclosing CR information reveal the following aspects:


— The reporting companies have a clear preference for stand-alone reports rather than including non-financial information in their annual financial reports, whilst integrated reporting is not common practice.
— 8 reports are prepared in line with the GRI Guidelines, 3 listed companies state they have been reporting according to stock exchange guidelines, but none of these reports is assured by a third party.
— Although 6 companies make the connection between their CR activity and the SDGs, just 2 of them identify the SDGs relevant to their business.
— 3 listed companies acknowledge that climate change is a risk for the business. However the potential impact is not quantified.
— Out of the 12 companies that acknowledged human rights as a relevant CR for their business, 6 have implemented a human rights policy and one of these policies refers to the UN Guiding Principles on Business and Human Rights.
— 23 companies reportedly work to improve the environmental, social and governance (ESG) performance of their suppliers and 14 have an ESG supplier code of conduct in place or their standard supplier code of conduct incorporates ESG issues.
— 7 reports include carbon reduction targets, out of which 4 are connected with global or regional targets (EU targets, Paris Agreement).

 

Geta Diaconu, Sustainability Advisory Director at KPMG in Romania explains the findings of the research on Romanian N100 CR reporting trends: “The main trigger for the increase in the number of reports since the issuing of the previous survey is the commitment of multinationals with operations across our country towards increased transparency. The effects of the Directive on non-financial reporting have not yet been experienced, and for the moment the market is at the stage of understanding the topic, exploring potential alternatives, tailoring a strategy and training people in this field of activity. Consequently, the number of published reports has not increased significantly.

 

Hopefully, during the next couple of years – due to regulatory requirements, market pressure and increased awareness– we will notice significant progress in Romania and in the region both in terms of the number and the quality of CR reports. The quality of the information disclosed remains an aspect that Romanian companies could further improve, as the use of internationally recognized reporting guidelines or standards is limited and there is almost no interest in the assurance of the reports”.

 

Alin Tiplic, Manager, Sustainability Advisory at KPMG in Romania, commented: “Reporting itself is merely an instrument, and therefore to really add value and prepare themselves for the world of tomorrow, businesses should become more connected with and contribute to global initiatives focused on making the economy greener and building sustainable societies. These global trends are becoming more prominent, and are also having an impact on the business environment, so immediate action is required. In this context. Probably a mindset shift is necessary for companies in Romania to make the transition from the financial bottom line to the triple bottom line and truly integrate sustainability into their business DNA.“

 

Download the KPMG Survey of Corporate Responsibility Reporting 2017 from www.kpmg.com/crreporting

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