The Covid-19 pandemic is a wake-up call to accelerate the transition to a more sustainable and inclusive global economy that can achieve the United Nations’ Sustainable Development Goals (SDGs). The SDGs provide a common framework of goals, targets, and indicators for governments, business, and others to address systemic, interconnected development challenges. These include many definitive issues of our time, including poverty, inequality, climate change and peace and justice.

Leaders from the business community have started rising to the occasion by aligning their purpose to serving the long-term goals of society and investors; this has to continue around the world and enabled by governments through the right policies and regulatory environment. Covid-19 has brought greater urgency, given it is a huge setback for sustainable development. Significant parts of the SDG agenda are in danger of becoming out of reach with a global recession looming and many countries experiencing significant reductions in GDP and tax revenues, and facing issues of inequality, unemployment, and escalating poverty. For example, the United Nations estimates that close to 1.5 billion worker livelihoods and income-earning abilities are currently at risk with low- and middle-income countries disproportionately bearing the socio-economic impacts of the pandemic.

Calls for “building back better” and delivering a green and just post-crisis agenda are being made against the backdrop of significant value destruction caused by the pandemic, particularly to ensure the well-being and prosperity of individuals at the same time as respecting planetary boundaries.

Those at the forefront of this agenda in the private sector are responding by connecting their strategies and activities to sustainable development and value creation, developing business-led solutions, and enhancing corporate sustainability. This involves thinking more deeply about the nature of private-sector value creation in the context of a rapidly changing world characterised by digital transformation and innovation, as well as heightened expectations on socio-economic and environmental responsibility.

To be resilient and successful, business needs to continue to provide the goods and services that people demand while it meets the needs of employees, suppliers, partners and environmental protection.

Integrated governance and thinking provide the pathway to comprehensively understanding and communicating how a business creates value for different constituents, and how an organisation is managing current and future opportunities and risks. This involves a clear purpose beyond delivering wealth to shareholders and to the company: businesses are increasingly identifying and promoting measures to track progress and steer the organisation towards more effective risk management and better reporting to provide investors and others with the relevant information about the prospects for long-term value creation. It is helping to build greater trust in the information that is reported.


Greater trust in business flows from business being seen as a force for good. The private sector can accomplish this by helping to solve the most intractable social and economic problems, including inequality, fraud and corruption, and systemic risks to our economic system such as climate change and biodiversity loss. These issues will be with us long after the threat of Covid-19 dissipates. Conceiving of business and finance as a force for good requires a change of mindset and leadership that leads to changes in the way we measure and report on success.

“Purposeful business” involves profitably solving the problems of people and planet by integrating relevant issues into governance and decision making. Corporate purpose and the outcomes of business activity can be guided by the SDGs, given that they provide the roadmap to 2030 to achieving sustainable and inclusive capitalism. For example, an increasing number of companies have broadened their stated purpose so that they specifically focus on delivering value to customers, stakeholders and society through their products and services. Connecting purpose to stakeholders and their desired outcomes provides a basis for defining value through the eyes of other stakeholders and, ultimately, for measuring success beyond financials.


The right kind of purposeful business requires a paradigm shift in which financial information and returns to shareholders are not the primary measure of performance and success but rather, the outcomes of delivering a positive contribution to stakeholders and to society.

To help businesses as they rethink value creation, IFAC, the International Integrated Reporting Council (IIRC), and the Association of International Certified Professional Accountants issued guidance for Chief Financial Officers (CFOs) and finance teams to lead their organisations toward long-term value creation.

Evidence demonstrates that the CFO and finance function need to help navigate, measure and communicate what matters to long-term success while delivering short-term resilience and performance. In the current crisis, this has involved applying the traditional financial skill set to immediate business resilience needs (for example, shoring up balance sheets and ensuring access to funding), pivoting their business and operating models more quickly than ever to digital, and being more attuned to ongoing stakeholder needs such as employee safety, customer value delivery, and partnering more closely with suppliers, governments and communities.

By providing relevant and integrated insights on all material aspects of value creation, CFOs and their teams are helping to shift the corporate mindset from short-term shareholder value creation to long-term stakeholder value creation and protection. Through integrated thinking and reporting, they are better placed to deliver those insights to Boards, CEOs, managers, investors and others. They can prepare their organisations for long-term success in the process.


The risk landscape is changing quickly. Risk management has taken on new meaning – and organisations need to evolve their enterprise risk management (ERM) to focus on interconnected external events that potentially have significant consequences for value erosion and financial performance. The accountant’s primary role in ERM cannot be solely to mitigate risk; accountants must also promote and facilitate effective risk and opportunity management in support of value creation. The new mindset described in “Enabling the Accountant’s Role in Effective Enterprise Risk Management” fundamentally involves enabling the organisation to make decisions amid uncertainty.

For many systemic issues, such as climate change, this means dealing with significant uncertainty with big implications. The management of such risks requires better approaches to ERM that incorporate different scenarios, including plausible events in which current business models require significant transitions. For example, regulatory changes, such as carbon taxation to deal with climate risk, would lead to a more rapid transition to a low-carbon economy. Such tail risks can quickly have financially material impacts on asset values and make legacy business models redundant.


High-quality and integrated information is critical for both internal and external stakeholders: companies cannot manage what they do not measure, and markets cannot allocate capital and price risk with what they do not understand.

To ensure corporate reporting is fit for purpose in the future, we need a global solution to reporting relevant, reliable and comparable information about value creation, sustainability and environmental, social and governance factors.

We also need to proactively push the widespread adoption of integrated reporting principles for the benefit of investors and others – learning from the 2,000-plus organisations already on this journey. This will help to ensure multifaceted value drivers are interconnected and that this information is placed in a strategic context covering purpose, governance, strategy and plans, risks and opportunities, resources and relationships, and business models. This approach enables companies to understand and communicate what is driving value creation over time, their prospects for resilience, and their contribution to more sustainable outcomes for business and society.


Trust in organisations is nurtured through robust governance that incorporates effective reporting processes, controls and oversight. Although reporting on value creation is gaining momentum, investors and other users often question the credibility, reliability and balance of information presented.

Strong governance is underpinned by an over-riding culture that fosters transparency and accountability, overseen by those charged with governance and executed by management. Trust flows from securing confidence in reporting, and this ultimately arises from high-quality reporting based on checks and balances within the organisation, as well as from assurance.

The demand for assurance of non-financial information is growing as much as the need for reliable, consistent and comparable data. Companies that obtain assurance provide greater confidence in their reports and disclosures, and typically benefit from enhancing maturity in their internal processes and controls around relevant data.


Through their actions, business has a big part to play – with the support of the accountancy profession – to enable economic and social progress. The SDGs cannot be achieved if there is low trust in business and capital markets, and the societies in which they operate. Weak financial markets and economic development are characterised by fraud and corruption, lack of transparency and accountability, and a singular view of success based on financial capital.

The leadership accountants provide in government and in business in the Covid-19 era starts with clarity of purpose focused on how a business – through its governance, strategy and business model – can generate broad and sustainable prosperity while respecting communities and the environment for generations to come.

Fundamentally, we believe that for companies to play an active role in building a more inclusive and sustainable capitalism, they need an integrated, multi-stakeholder approach to the way they operate and govern themselves, with a focus on long-term value creation.

To achieve broad-based sustainable development by 2030, for their part, all accountants need to learn to account for the indivisible and integrated dimensions of the economy, society and the environment.

Charles Tilley is Chief Executive Officer, International Integrated Reporting Council, and Stathis Gould is Director, Advocacy, International Federation of Accountants (IFAC). This article was first published in Knowledge Gateway, IFAC. Copyright © 2020 IFAC. Used with permission of IFAC. Contact IFAC for permission to reproduce, store or transmit this document.