The UK Government has welcomed new EU rules which broaden the scope of annual reports. Once a dry repository for accounting calculations, the annual report has now expanded into a document which is as much about the ethical and sustainable elements of organisations as it is about the figures.
This latest addition from the EU will require companies to report on “environmental, social and employee matters and any issues relating to human rights and bribery.” In welcoming the changes the government announcement highlighted the way in which disclosures of this nature are crucial for investors and potential customers. The new regulations currently only affect large public companies.
These changes serve to reinforce the way in which company leadership is now very much an affair of the heart as it is of the head. With ethics, employee engagement, social and environmental factors all playing their part in the day to day life of an organisation; the old ‘profit is king’ mantra has gone and leaders now have to look to creating and sustaining a culture of ‘rightness.’
Referring to the changes business minister, Jenny Willott, said “I welcome any efforts to improve transparency in the way companies are managed and controlled.”