Has an Aussie found the business case for sustainability reporting?

Thanks to Phil Hughes, the Director of the Centre for Public Agency Sustainability Reporting in Melbourne Australia for bringing an interesting tidbit to my attention.
He spotted a new report that reveals strong economic case for sustainability risk reporting to be adopted by Australian businesses.

On August 1st 2007, the Financial Services Institute of Australia (Finsia) released the first economic analysis to examine the costs/benefits to business and the economy of sustainability risk reporting in Australia.

The report, Tip of the Iceberg, found that benefits arise because companies with sustainability risk reporting benefit from lower corporate borrowing costs as a result of reduced risk, and higher labour productivity and sales from the boost to their reputation with employees and customers.

“In short, there is a strong economic case – to the tune of $1.2 billion GDP per annum and a significant profit gain of 2-3 per cent for medium and large companies that voluntarily report on sustainability risks”.

“Overall, the voluntary adoption of SRR [sustainability risk reporting] by more Australian businesses appears to be a worthwhile investment for them, as well as having wider economic benefits, and so should be encouraged by Australian Governments”.

The report also found that the proportion of Australian top 100 companies reporting of sustainability risks was likely to increase from 23 per cent to 60 per cent within three to five years.

Finsia commissioned the independent study conducted by Econtech, to determine the costs/benefits of environmental, social and corporate governance for sustainability reporting to business and the overall economy. They refer to this style of reporting as sustainability risk reporting (SRR).

The report is part of Finsia’s Tip of the Icebreg – investing for the long-haul campaign on sustainability risk reporting. The report was released at a sustainability summit in Sydney and is now available to download (large 7M paper).