Informationsværdien af CSR

Abstract

This thesis aims to examine the legal requirements and the users’ needs for Corporate Social Responsibility (“CSR”) reporting, as well as the possibility of obtaining an audit assurance regarding the report. The thesis only concerns companies in Denmark which are required to publish a CSR report. These companies are, as stated in Danish Financial Statement Act § 99a, large companies, more specifically companies which are in class large C and class D1. The authors look into requirements regarding the reporting, stated in the Danish Financial Statement Act. Here it is specifically stated, that the CSR report should either be a part of Management’s Report in the Annual Report, Supplementary Report or as an independent report on the company’s website. Companies can also join United Nation’s Global Compact (UNGC) and create a Communication on Progress (COP) report to UNGC. The COP report is not part of the Annual Report as the other alternatives are.2 The report should revolve around issues regarding human rights, labour, environment and anticorruption. CSR reporting has been obligatory for large companies in Denmark since 2009. To show the compliance development, the authors have, in this thesis, integrated a study made by Copenhagen Business School (CBS) regarding companies’ compliance to the law. The report shows a positive development from 2009 to 2011. There are still a few companies that do not comply with the law, however those who are abiding the law have been actively using international reporting standards and place the report many different places, for example as part of the Management Report in the Annual Report and on the company’s website. This increases the availability of the CSR report for the users. To gain knowledge about Annual Report users’ needs of CSR reporting, the authors analyse users’ needs using IASB Conceptual Framework’s defined users. It is identified that by satisfying the primary users3 of the Financial Report’s needs, secondary users’4 basic needs, will also be covered. Also, primary users use the Annual Report to decide whether or not to invest in the company. Decisions are made on the basis of the company’s activity and profitability. The Financial Report5 gives the investors an insight to the company’s financial situation in a certain period of time. In able to decide whether or not to invest, the investor needs historical data as well as data that can tell them about the future. Here CSR report is relevant, as a company’s CSR initiatives have a great impact on their reputation which affects the company’s future growth, especially in a growing global society. CSR reporting shall show the true and fair value of the topics it presents for it to be useful in decision making. True and fair value of the reporting is secured by having laws and guidelines that supports it. An independent third party’s opinion on the report adds credibility to it. To figure out whether laws and guidelines established for CSR reporting supports the true and fair value of the reporting, the six levels in the IASB Conceptual Framework is used, to analyse regulations in Danish Financial Statement Act, UNGC guidelines to COP report and other international standards regarding CSR reporting. The authors identified, that regulations in Danish Financial Statement Act, UNGC’s guidelines nor other international standards alone supports the true and fair value of CSR report. A combination of each will give a better true and fair value of a CSR report. An auditor can give a reasonable or limited assurance to add credibility on CSR report. It however requires not only a lot of knowledge regarding the reported topics but also a certain maturity in the regulations and guidelines that supports it. By looking in to 10 of the biggest companies in Denmark, it is seen, that these companies get either no assurance or limited assurance on their CSR report. Class D companies use a combination of different regulations and international standards, but settles for a limited assurance, simply because guidelines for CSR reporting have not reached its maturity. Finally, the authors of this thesis give recommendation as to which regulations and guidelines to use, whether to get an auditors opinion, and where to place the CSR report, depending on the user’s needs and the company’s objectives. Regardless of what the company’s objectives are, whether it is to become a sustainable company or merely to satisfy the primary users of the Annual Report, an analysis of the users is required to be able to identify their needs and how to proceed with the reporting. The authors of this thesis also state their recommendation as to how to improve laws regarding CSR reporting, to ensure a true and fair value of the report.