Skip to content

ACCA Strategic Professional · Strategic Business Leader · Reporting to stakeholders

Aurelia Group publishes a glossy sustainability narrative reporting record emissions cuts and strong stakeholder engagement. Analysts note it omits the failure of two flagship plants to meet targets, uses selective metrics that change yearly, and has no independent assurance. Which conclusion best reflects good practice in narrative reporting?

The report is deficient because good narrative reporting must be balanced, consistent and credible. Omitting missed targets, switching metrics and lacking independent assurance risks misleading stakeholders and amounts to greenwashing, which undermines trust even though such reporting may be voluntary.

  1. AThe report meets expectations because narrative reporting is voluntary and promotional by nature
  2. BThe report is deficient because it lacks balance, consistency and credibility, so stakeholders may be misled and trust damaged ('greenwashing' risk)Correct
  3. CThe report is deficient only because it lacks audited financial data
  4. DThe report is acceptable if the metrics improve each year, regardless of definitions

Explanation

Good narrative reporting should be balanced (covering negatives), comparable over time and credible, ideally with assurance. Omitting failures and changing metrics create greenwashing risk. Voluntary status does not remove the duty not to mislead, and the issue is not audited financial data.

Did you get it right without looking?

One question tells you little. A timed set on Reporting to stakeholders shows your real accuracy, how long you take and where you lose marks.

Practise Reporting to stakeholdersFree diagnostic mock

More Reporting to stakeholders questions