Login
Contact
To find out more about commissioning customised research, contact:
UK & INTERNATIONAL
+44 (0) 20 7160 9800
NORTH AMERICA
+1 800 402 8774
Environmental disclosure: the second major review of environmental reporting in the Annual Report & Accounts of the FTSE All-Share
11 October 2007
Please enter your login details on the right hand side of this page to download the report.
Key Findings
- Nearly all companies now report on the environment in some way. However, much environmental reporting is still at a very basic level – it may be just a one-word mention of a key phrase that this study was designed to identify. (Ninety eight per cent of the companies referred to the environment in 2006, compared to 89% in 2004).
- In particular, FTSE Small Cap companies have increased their level of environmental reporting since the 2004 report. They now report at a similar level to FTSE 350 companies. (Ninety seven per cent of Small Cap companies referred to the environment in 2006, compared to 80% in 2004.)
- Only 42% of the companies surveyed provided statistics and figures in their annual reports and accounts. However, there has been an increase in the level of quantified disclosures – up 15% from 27% in 2004. Only 15% provided quantified disclosures that enabled direct comparison between the environmental performance of companies.
- Of the companies that did report fully comparable statistics and figures, 63% reported on just one topic out of water, waste, and energy use/climate change. Twenty one percent reported on all three topics. (In 2004, 58% reported on one topic and 10% on all three.)
- Thirty five per cent of companies made environmental disclosures in the audited sectionsof their annual report and accounts. Fifty per cent made disclosures in either their OFR, Business Review or Directors’ Report. These sections are reviewed for consistency with the audited parts of the annual report and accounts. The numbers show a big increase since 2004, when just 12% of companies made environmental disclosures in audited sections.
Extract
This report presents the disclosures of over 500 FTSE All-Share companies after the new legislative requirements came into effect and Government guidelines were issued and is based on their Annual Reports and Accounts for 2006/07. Whilst the report evidences there has been some progress from the previous levels of qualitative disclosures, quantitative disclosures are still only made by 34% and very few companies provide sufficient information which was suitable for shareholders and investors to base decisions on.
Environmental issues like scarcity of raw materials, energy costs and climate change are having an increasing financial significance for business. The report is intended to encourage comapnies to adhere to Government guidelines and provide the best examples of reporting to so that the city and business can help to maintain and improve the environment.
Why did the Environment Agency commission the research?
The Environment Agency has commissioned this study as part of an ongoing programme to review corporate reporting and is an update to their report produced in 2004. The aim of this report was to investigate what progress has been made since 2004. The report analyses the annual reports of FTSE All-Share companies, all of which now have to comply with the revised company law regulations. These regulations require companies with significant environmental impacts to report them in a Business Review as part of their annual reports and accounts.
The repeal of the Operating and Financial Review regulations in late 2005 caused considerable confusion and it was therefore hoped that the study would also assist directors to understand their new reporting obligations.
Report image: Climate change and energy use by sector
About Trucost
Trucost services for companies
Trucost services for financial institutions
Trucost services for government
Trucost University Partnership