Adopt integrated reporting: SEBI asks top 500 companies

The securities and exchange board of India (SEBI) asked top 500 listed companies to adopt an integrated reporting framework from the next financial year, beginning on 1 April.

The market regulator SEBI has taken this bold move to improve disclosure standards and provide stakeholders relevant information, which can help them in making investment decisions. The reporting is aimed to indicate a concise communication about the company's business and non-business activities, so that there is more clarity in the public about the company's dealings. 

In a circular, SEBI informed that the integrated reporting may be adopted on a voluntary basis from the financial year 2017-18, by top 500 companies which are required to prepare business responsibility reports (BRR). The decision has been taken in consultation with industry bodies and stock exchanges. The board also added that the information related to integrated reporting should be provided in the annual report.

The BRR is mandatory for top 500-listed entities based on market capitalisation at BSE and NSE. These are submitted by the companies along with annual reports and indicate the number of complaints related to child labour, forced labour, involuntary labour and sexual harassment during a financial year. 

The International Integrated Reporting Council (IIRC) has prescribed guiding principles that can be useful in preparing the content of the integrated report. IIRC believes that the content should be concise but provide an insight into the firm's strategy. The report should be balanced and include all material matters, both positive and negative, and also disclose information about matters that affect the organisation's ability to create value over the short, medium and long term.