I am in the US to talk about country-by-country reporting at Yale University.
The slides I’ll be using are here.
As I say in them:
- CBC is a new way of looking at the MNC;
- It is in essence a demand for a profit and loss account and limited balance sheet for each country in which the MNC trades;
- But it’s also something much more than that;
- This is an accounting system that roots the corporation in the countries that host it – and not somewhere floating above them; and
- And this is accounting that says the MNC is an entity in its own right with responsibilities all of its own – it’s not just an agent for its owners.
What are those responsibilities?
- To meet need, and so make profit;
- To do so sustainably or we wouldn’t invest in it;
- To do no harm;
- To settle its obligations;
- To be accountable for doing so; and
- To be honest in that accounting.
But that means it is accountable to:
- The equity investor group (shareholders);
- The loan creditor group (banks and bondholders);
- The analyst-adviser group who advise the above groups;
- Business partners;
- The surrounding community;
- Civil society organizations; and
- Governments and their institutions.
And it is precisely because of this diversity that is both universal, and without exception local, that we need country-by-country reporting.
The rest is on the slides.
With thinks to the Task Force on Financial Integrity and Economic Development for inviting me over for this event.