Embracing Change: 4 Key Areas Where Accountants Can Lead the Way
As the world increasingly focuses on sustainability, the accounting profession in South Africa is pivotal in steering this important shift. The International Federation of Accountants (IFAC) published has highlighted 4 key areas where accountants need to update and enhance their skills to meet the demands for comprehensive, sustainability-related reporting.
1. Technical Expertise
Traditionally, accountants excel at creating detailed financial reports and analysing complex data to aid management decisions. With new sustainability-related reporting and assurance standards emerging, accountants now need a broader skill set. They must learn how to effectively implement these standards, create new performance metrics, and manage diverse sustainability-related data sets. Setting up effective systems and controls for sustainability reporting is also essential.
Steps Accountants Need to Take:
Understand the New Standards: Accountants need to get familiar with new reporting frameworks like IFRS S1 and IFRS S2, which standardise how companies report their sustainability impacts.
Set Measurable Performance Targets: It’s important for accountants to learn how to establish and measure performance against science-based targets, such as those for carbon emissions or water usage.
Implement Systems to Collect Data: Designing and assessing strong systems and processes for collecting and reporting sustainability data will ensure the reliability of these disclosures.
2. Business Acumen
The new era demands accountants to think systematically, assessing how global sustainability trends affect business models and value chains. This involves understanding how financial and sustainability risks are connected and providing strategic advice based on comprehensive evaluations of these risks.
Steps Accountants Need to Take:
Integrate Sustainability into Strategies: Accountants should assist businesses in weaving sustainability into their core strategies, focusing on its impact on governance, risk, and performance management.
Inform Decision-Making: Providing actionable sustainability-related information will help management make informed strategic decisions.
3. Behavioral Competence
Accountants are trained to be analytical and adaptable, skills that are ever more vital as they navigate new challenges in sustainability reporting. Enhanced collaboration skills are necessary to work effectively across multidisciplinary teams and with diverse stakeholders.
Steps Accountants Need to Take:
Upgrade Analytical Skills: Adapting these skills to handle new types of sustainability data and future scenario analysis is crucial.
Boost Collaboration: Strengthening teamwork and communication skills will enable accountants to work effectively with environmental experts and sustainability consultants.
4. Ethics and Professional Values
Ethical practices remain central to accounting. As sustainability becomes integral to reporting standards, accountants will face new ethical challenges and must ensure the integrity of sustainability disclosures.
Steps Accountants Need to Take:
Follow Ethical Standards: Accountants must ensure their sustainability reporting complies with international and national ethical standards.
Handle Ethical Challenges: Identifying and managing potential ethical issues in sustainability contexts, such as conflicts of interest or biased reporting, is crucial.
Implementing the sustainability reporting standards offers both challenges and opportunities for accountants in South Africa. Accountants can lead their businesses towards sustainable practices by expanding their technical expertise, incorporating advanced business acumen, refining behavioural skills, and adhering to stringent ethical standards. This proactive role positions accountants in a niche market, opening significant growth and leadership opportunities.
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About the Executive Education
Sustainability and climate change efforts are prominent compliance matters, and are currently viewed on corporate agendas as key for increasing efficiency and a source of competitive advantage. Leading finance executives understand that climate change efforts cannot be separated from business and there is an urgent need to involve key decision makers in reporting on progress as it relates to the climate change agenda.
Professional accountants and finance executives are pressured to play a key role in preparing their companies for a new regime and reporting progress made in reducing emissions, whether directly or indirectly.
The Executive Education and License in Climate and Sustainability Reporting, developed by CIBA and Regenesys School of Accounting Science, will equip finance leaders to confidently fulfil this role and will serve as proof of your competency in this field. The programme provides you with the knowledge, skills, professional direction and corporate strategy to assess changes in the environment, define a strategy to address them, identity opportunities of climate change and successfully report and disclose relevant climate matters.
