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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Integrated Reporting Framework, Global Reporting Initiative Framework and Business Responsibility and Sustainability Reporting

Sagar Auto Ltd's integrated report describes inputs such as steel and skilled labour, business activities, and then outputs such as vehicles and waste. It separately presents the effects on its capitals, such as improved employee skills and increased emissions. Which description correctly identifies the effects on capitals in IIRC terms?

The effects on the capitals, such as improved employee skills or increased emissions, are outcomes. The IIRC defines outcomes as internal and external consequences, positive or negative, of activities and outputs. Products and waste are outputs, while inputs are the capitals drawn on at the start.

  1. AOutputs, being the products and by-products of the business model
  2. BOutcomes, being internal and external consequences for the capitals resulting from activities and outputsCorrect
  3. CInputs, being the capitals drawn on by the business model
  4. DStrategy, being the allocation of resources to achieve objectives

Explanation

In the IIRC business model, inputs are transformed through activities into outputs, and outcomes are the resulting internal and external consequences, positive or negative, on the capitals. Vehicles and waste are outputs; improved skills and higher emissions are outcomes, so option one is wrong.

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