Financial Times

ACCA sustainability reporting awards
Being accountable for corporate actions
Isn't it sad when companies are scared of being responsible: only thinking of their profits and CEO pay packets? The thing is, there is much more these days to keeping a company sustainable in this globalised environment, such as social responsibility, in fact it's becoming a necessity.

There is an acronym that is slowly becoming the centre of business behaviour; and it seems to be taking shape here in Sri Lanka - CSR or Corporate Social Responsibility.

On Thursday night the Sri Lanka section of the Association of Chartered Certified Accountants (ACCA) held its sustainability reporting awards. It was a very pleasant evening spent at the Cinnamon Grand Colombo, but the sad thing was there were only 17 companies that sent a report to be judged. And as Dr. Eric D. Wickramanayake, senior conservation scientist for the World Wildlife Fund US, said, "some of those reports were disappointing". But there were two winners that night: John Keells Holdings Ltd (JKH) and Diesel and Motor Engineering Company Ltd (DIMO).

Both companies portrayed their environmental ideals, about created values and who will share in them. DIMO gave examples of improving the environmental features of its products, as well as detailing information about social issues including human rights and labour practices. John Keells got the nod for getting the stakeholder bandwagon moving, broadcasting future year's policies, and stating the need for publishing a sustainability report. And worthy winners they were.

But events like this are not just about the winners, they are about spreading awareness; getting other companies on board and hoping there are "double this year's number next year", as Sumithra Gunasekera, JKH Director, said.
When it comes to the accounting, environmental, social and sustainability reporting, they are still considered new in Sri Lanka, hence the awards.

Part of the reason: the company chief''s responsibility is to keep the finances in good order, thus keeping the main shareholders or owners happy, but without thinking beyond the banking figures in black. "These days shareholders and the general public want more social awareness when it comes to a company's responsibilities," said U. H. Palihakkara, President of ACCA Sri Lanka.
He encouraged companies to show the environmental and social impacts on their surroundings, from micro to multinationals.

The good thing is there is advise and help available to attain this, according to Rachel Jackson, Social and Environmental Issues head, ACCA. She said that environmental impact reports can have an effect on a whole range of social ailments, such as poverty and AIDS, as have been shown by the 11,000 reports written worldwide so far. The problem at the moment, she said, was that only 2 percent of South Asia's companies were participating.

'The thing is companies have got to stop looking to the near future, to short-term profits, but beyond, to sound economics and the welfare of future generations. There is the need to keep going," said Peter Harrold, World Bank Country Manager.

"The problem is that Sri Lanka is slipping behind when it comes to comparing economic growth with environmental sustainability. If continued, the country's long-term economic growth could be threatened," he warned. And on top of that, he said that the Europeans, Northern Americans, the Japanese were demanding more "green consummerism" as a way of life.

Dr. Wickramanayake, also one of the judges, hoped that more companies would take the time and the interest to participate next year. He said that when it comes to future reports, there should be no waffle, just a complete and honest account of what the company does and wants to do. As for the winners, DIMO's Chairman, A. R. Pandithage, said that the award would add a new dimension to the company, plus thanks were given to his finance department for doing such a good job.

John Keells' Mr Gunasekera said that these days with the number of public limited companies, management will have to start thinking beyond the boardroom. But he was certainly happy about winning in his company's first attempt. He also thanked his stakeholders, saying winning such an honour would have been impossible without them.

And then it was over, but there was a lasting query. Producing the report does not mean hiring umpteen extra accountants; most of the needed information is collected each year according to the law. So why aren't there more companies caring about their social, environmental and sustainable responsibilities? If you are a shareholder or just care, why don't you ask?

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