Business Sustainability in Asia

CHAPTER 5Financial Economic Dimension of Sustainability

1. EXECUTIVE SUMMARY

Previous chapters briefly discussed the five economic, governance, social, ethical and environmental (EGSEE) dimensions of sustainability performance. The fast-growing move toward business sustainability has created unprecedented challenges for business organizations worldwide to present reliable and useful financial and non-financial information on their key performance indicators (KPIs) pertaining to all five EGSEE dimensions of sustainability performance. The primary function of business entities is to create shareholder value through continuous sustainable economic performance. This chapter discusses the importance of economic sustainability performance; (ESP) and related KPIs, measurement, recognition and reporting in the form of financial statements; and performance assurance in the framework of audit reports on financial statements and internal control over financial reporting (ICFR). This chapter also describes in detail the financial ESP dimension, its importance and relevance in ensuring a sustainable organization, and its value relevant disclosures, reporting and assurance worldwide and in Asia. Non-financial governance, social, ethical and environmental (GSEE) dimensions of sustainability performance and reporting are discussed in detail in the next several chapters.

2. INTRODUCTION

Investor confidence in financial markets is the key driver of economic growth, prosperity and financial ...