Open House Day on November 30th at Audencia's Paris campus! Come and meet us, visit your future school and find out about all our international programs. Register now!
Research
Internal Audit & ESG
European Study - 2023
Today, corporate performance is global and integrated, and the auditing professions have a key role to play in the quality and verification of the information delivered through this performance. It is with this in mind that IFACI is supporting the Audencia Multi-Capital Global Performance Research Centre in its research work,with the shared aim of supporting the transformation of the teams and professions involved in this essential new challenge.This summary presents the results of the second study carried out jointly by IFACI and Audencia’s Multi-Capital Global Performance Research Centre, with the aim of analyzing the situation of the profession with regard to ESG issues and practices in Europe, understanding the obstacles to integrating these issues, and guiding the actions of IFACI, and other IIA European Institutes. The Research Centre is supporting the profession in meeting this challenge.
Double materiality and sustainability matters
Key challenges to be addressed under the CSRD
There is a growing demand for greater transparency in sustainability information provided by companies, whether from the public, regulatory bodies or employees. The European Commission has responded by replacing the 2014 Non-Financial Reporting Directive (NFRD) with the Corporate sustainability Reporting Directive (CSRD). A key pillar of the European Union’s sustainable finance strategy, the CSRD aims to strengthen the publication of sustainability information by companies. In so doing, the very nature of corporate reporting is undergoing radical change. Sustainability
reporting must become as robust and rigorous as financial reporting.
IFACI, PwC, ORSE and the Global Multi-Capital Performance Chair have drawn up a joint study on this subject.
What are the connections between financial and non-financial accounting?
We thought it was time to take a step back again from the way in which researchers, practitioners and standard-setting bodies have approached the question of the connection between the environment, social and intangible factors and financial accounting since the 1970's. This questioning is obviously not new, as can be seen from the extensive work carried out by Price Waterhouse USA in the 90s (1991, 1992, 1993, 1994) and the many chapters devoted to the subject in books published by researchers Rob Gray (2001) and Stefan Schaltegger (1996, 2000), but also the Ordre des Experts Comptables (1996). We are therefore provided a new update, in July 2020, based on a study that lasted 5 months, carried out by the Audencia research chair team.
Thus, our research work consisted in forming a structured panorama of a large number of initiatives. The aim is not necessarily to be exhaustive, as this is a difficult task. However, we have structured a vision of the connections in order to enlighten all those who, in practice, in writing standards or in research, would like to tackle the question of the "accounting" of this "non-financial".
Presentation of the report with IFACI and PWC
This study, carried out in collaboration with Audencia's Multi-Capital Global Performance Chair and the French Institute of Internal Audit and Control (IFACI), deciphers the internal control challenges brought about by the new European directive. On the one hand, it presents findings and best practices directly derived from testimonials, and on the other, the authors' reflections on the issues at stake and their impact on current practices. This collaborative study constitutes a shared position paper, based on an in-depth consultation of some fifteen companies, carried out from June to September 2022.
Audencia's multi-capital Global Performance chair has contributed, alongside HEC's Society & Organizations institute and the Lumia school, to the third international Prophil study, carried out with the support of AFIR, the Compagnie nationale des commissaires aux comptes [National Auditors Company], norsys and SeaBird Impact. The study invites companies to embark on the path of post-growth by reinitializing their business model, governance, valuation and accounting system, in order to re-frame our economy the framework of planetary limits and social foundations.
Doctoral studies
This thesis seeks to shed light on the levers and obstacles companies face in integrating natural and human capital into general accounting. Firstly, the connection that exists today between financial accounting and these non-financial capitals is studied. A research-intervention was also carried out to study the implementation of a multi-capital accounting model in SMEs. This involved a 6-month experiment with 3 SMEs. These companies are Yever (a Burmese consulting firm), Nepsen (a French group of ecoenergeticians) and Bathô (a SSE and circular economy company in the Nantes region, transforming non-recyclable pleasure boats into accommodation). The aim is to understand how best to help and support companies in their transformation towards greater sustainability, while respecting planetary limits and social foundations.
The aim of this thesis is to be able to measure the positive impacts of companies and ultimately develop an accounting model and methodology enabling organizations to assess their positive contribution.
This positive impact accounting methodology will be linked to the multi-capital methodology developed by the chair and will be applied as part of an experiment at the InVivo company.
The thesis topic "Multi-capital accounting for major groups" will involve the collaborative design and application of this model using data from the Chair's partner companies: Danone and L'Oréal. This experiment will demonstrate that it is also possible to integrate natural and social capital accounting into the financial accounting of major groups. The notion of a budget (to be reached or not to be exceeded) allocated to the various capitals will make it possible to represent the final performance of major groups, measured against planetary limits.