The Prince’s Accounting for Sustainability Project (A4S) Chief Financial Officer (CFO) Leadership Network has published four guides to help the finance and accounting community address the practical issues of integrating sustainability into their business processes and decisions.
The guides have been developed by the A4S Chief Financial Officer (CFO) Leadership Network and their teams (comprising senior finance, risk, internal audit, investor relations and sustainability professionals), A4S and other
specialists. Each guide is supported by case studies from Network members which demonstrate practical applications of the approaches and techniques set out in the guides.
The four guides are:
- CAPEX: a practical guide to embedding sustainability into capital investment appraisal. Outlines how businesses can adapt their existing capital investment appraisal processes in a pragmatic and systematic manner to integrate social and environmental issues. The guide describes how traditional financial return-based investment decisions can be broadened, to make sustainability issues more explicit and transparent. Examples are also provided of how this can lead to more cost effective and resilient investment decisions.
- Enhancing investor engagement: a practical guide for investor relations teams to engage on the drivers of sustainable value. Assists investor relations teams as they seek to engage investors on the link between sustainable business models and the creation of shareholder value. The guide provides overarching principles on communicating with investors and offers insights into Network member’s experiences of the successes and pitfalls. It covers ideas that are quick and easy to implement such as incorporating sustainability information into investor presentations, to those that will take more time, such as moving away from quarterly reporting of financial results.
- Managing future uncertainty: an introduction to integrating risks resulting from macro sustainability trends into business decision-making. Introduces finance and risk professionals to the potential business impacts from macro sustainability trends (such as climate change, water scarcity, increasing population and severe weather events). It sets out why it is important to adapt traditional risks management process to respond to these trends, and provides examples of how to overcome some of the uncertainty associated with their impact, so they can be better integrated into business decisions.
- Natural and social capital accounting: an introduction for finance teams. Helps finance teams increase their understanding of the growing movement around natural and social capital accounting. It explains the key terms finance teams should know, how broadening accounting frameworks can benefit business, and the
- central role of the finance team on collecting, analysing and reporting this new type of information. The guide suggests a set of overriding principles based on financial accounting principles to assist the decision making process. It explores the benefits and challenges of converting natural and social capital impacts and dependencies into financial figures, to gain the attention of decision makers.
John Rogers, CFO of Sainsbury’s and chair of the A4S CFO Leadership Network, the group which have produced the guides, said, “As CFOs we have a crucial role to play in helping our businesses to understand the value of values, and sustainability in particular. It can be a challenge knowing where to start, so these guides are designed to give CFOs practical advice using real case studies of how others have tackled the issues.”
Commenting on the launch of the guides, Sarah Nolleth, Director of A4S said, “CFOs and finance teams have a crucial role to play in embedding sustainability within organisations’ decision making processes. These practical guides, written by practitioners in the field who have experienced and tackled some of the issues first hand, will help the finance and accounting community to build more resilient businesses, ultimately leading to better commercial outcomes.”
“The guides have been developed with a finance audience in mind but will also be of interest to sustainability professionals and other types of decision maker,” added Sarah.
Network members will continue to implement the approaches outlined in the guides and publish further case studies later this year. In 2015, the Network is undertaking new projects to develop additional guidance, including integrated management reporting and embedding sustainability into budgeting and forecasting.
The guides can be downloaded from https://www.accountingforsustainability.org/cfos/network-of-chief-financial-officers/a4s-cfo-leadership-network-activities
Network members would value feedback on these guides from other organisations working in these areas. Please send any comments to: firstname.lastname@example.org
Deborah McSkimming, Senior
Communications Officer, The Prince’s Accounting for Sustainability Project, Tel:
+44 (0)20 7024 5701 Mob: +44 (0)7467 147 573
About The Prince of Wales’s Accounting for Sustainability Project
The Prince’s Accounting for Sustainability Project (A4S) was established by HRH The Prince of Wales in 2004 to “help ensure that we are not battling to meet 21st century challenges with, at best, 20th century decision-making and reporting systems.” A4S convenes leaders in the finance and accounting communities to catalyse a fundamental shift towards resilient business models and a sustainable economy.
A4S works with the accounting and finance community to:
Demonstrate the business case, increase engagement and build capacity to drive behaviour change that results in sustainable business practices.
Develop practical tools, guidance andapproaches that enable environmental, social and economic risks and opportunities to be reflected in decision-making.
Facilitate the creation of an enabling environment for change through a shift to sustainable capital markets, and supportive regulatory and reporting regimes.
A4S has two global networks – the Accounting Bodies Network whose members comprise approximately two thirds of the world’s accountants and the CFO Leadership Network, a group of CFOs from leading
companies seeking to transform finance and accounting.
About the A4S CFO Leadership Network
The A4S Chief Financial Officer Leadership Network was launched by HRH The Prince of Wales at St James’s Palace in December 2013. Network members marked the launch with a letter to The Telegraph.
The Network brings together a group of CFOs from large European businesses seeking to embed the management of environmental and social issues into business processes and strategy. It is understood to be the first grouping of its kind globally.
The following CFOs contributed to the development of the guides through the A4S CFO Leadership Network:
- Scott Longhurst, Anglian Water, Managing Director of Finance & Non Regulated Business
- Evelyn Bourke, Bupa, Chief Financial Officer
- Carol Fairweather, Burberry, Chief Financial Officer
- Pierre-André Terisse, Danone, Chief Financial Officer
- John Rogers, Sainsbury’s, Chief Financial Officer
- Rolf-Dieter Schwalb, Royal DSM, Chief Financial Officer
- Alan Stewart / Paul Friston, Marks and Spencer, Chief Financial Officer / Interim Chief Financial Officer
- Andrew Bonfield, National Grid, Finance Director
- Gregor Alexander, SSE, Finance Director
- Susan Davy, Pennon Group (South West Water), Group Director of Finance
- Lucinda Bell, British Land, Chief Financial Officer
- John Lelliott, The Crown Estate, Finance Director
- Jean-Marc Huët, Unilever, Chief Financial Officer
- Russ Houlden, United Utilities, Chief Financial Officer
- Richard Mayfield, Walmart, EMEA (Ex Asda CFO) Chief Financial Officer
- Liz Barber, Yorkshire Water Group, Director of Finance, Regulation & Markets