Corporance Asesores de Voto, S.L.
Corporance
Corporance Asesores de Voto S.L.
ID: 164997345395-73
Lobbying Activity
Response to Strengthening the quality of corporate reporting and its enforcement
4 Feb 2022
We welcome the initiative of asking for feedback and comments on the improvement of the quality and compliance of corporate reporting, for the sake of transparency. An increase in disclosure will not only benefit the existing shareholders of a company, but also entice potential investors to compare and contrast corporate sustainability data in order to make an informed decision. Homogenisation throughout the EU will help multinational companies to effectively communicate their long-term strategies to all the markets it operates in without having to adapt each statement to the countries' format, as well as complying with their increasing reporting obligations.
In Spain, Law 28/2018 was published asking for large and listed companies to publish a Non-Financial Information Statement with data on the following points:
-Business model, policies, indicators and risks,
-Environmental issues,
-Social and personnel issues,
-Respect for human rights
-Anti-corruption and bribery,
-Company commitments to sustainable development,
-Subcontracting procedures and supplier relations,
-Relations with customers and consumers,
-Results and taxes by country.
Throughout the past 3 years, from CORPORANCE, The Spanish proxy advisor, we have been analysing these statements as part of our service of emitting voting recommendations. We have noticed a clear improvement each year. However, since there is no official taxonomy for multiple of environmental and social issues, statements of different companies are rarely comparable. Making it hard for both issuers and investors to have a single way of presenting / receiving such data, unlike the annual financial accounts, which only slightly vary throughout companies. The need of a clear and comparative metrics and indicators is imperative.
Another point of discussion could be the auditors designed to review the corporate sustainability information. Should the same auditors that review the annual accounts be the ones to supervise this statement? Would they be independent? While we understand the economies of scale involved in using the same audit firm for all processes, we believe a true independent auditor would be beneficial in the long-term. Regardless, aspects such as maximum tenure, fees paid and conflicts of interest will eventually need to be regulated, much like the financial auditors.
Overall, we thank the Commission for the opportunity to discuss this initiative
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