Research Article


DOI :10.26650/MED.1253502   IUP :10.26650/MED.1253502    Full Text (PDF)

Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index

Gözde Nezriye Bi̇rcanİrem Özcan

According to International Financial Reporting Standards (IFRS), the financial information enterprises report must be comparable, verifiable, understandable, and presented timely, as well as relevant and faithfully represented. In today’s world and the prominence of sensitivities toward environmental, social, and managerial issues such as pandemics, climate crises, and waste problems, as well as the increasing impact these issues have on the decision-making process of financial statement users, reporting sustainability-related information that includes this financial information with the characteristics stated above has been released as a required need. The study examines the degree to which financial reports and other related reports from enterprises on the BIST Sustainability 25 Index comply with the requirements of the exposure drafts of the IFRS S1 and IFRS S2 based on these requirements using descriptive and content analyses to explain the important points and deficiencies identified in the process of reporting sustainability-related information.

JEL Classification : M41 , M48
DOI :10.26650/MED.1253502   IUP :10.26650/MED.1253502    Full Text (PDF)

Sürdürülebilirlik Raporlaması Açısından UFRS S1 ve S2 Taslak Standartlarına Uyum Sürecinin Değerlendirilmesi: BIST Sürdürülebilirlik 25 Endeksi İşletmeleri Üzerine Bir Araştırma

Gözde Nezriye Bi̇rcanİrem Özcan

Uluslararası Finansal Raporlama Standartları uyarınca işletmeler tarafından raporlanan finansal bilgilerin finansal bilgi kullanıcıları açısından faydalı olabilmesi için ihtiyaca uygun ve gerçeğe uygun şekilde sunulmuş olmasının yanı sıra karşılaştırılabilir, doğrulanabilir, anlaşılabilir nitelikte olması ve zamanında sunulmuş olması gerekmektedir. Günümüzde pandemi, iklim krizi, atık sorunu vb. gibi çevresel, sosyal ve yönetişimsel konulara yönelik hassasiyetlerin ön plana çıkması ve finansal bilgi kullanıcılarının işletmelere yönelik yatırım kararları üzerinde bu konuların etkisinin giderek artmasıyla birlikte işletmeler tarafından mevcut finansal bilgilere ek olarak sürdürülebilirlikle ilgili bilgilerin de raporlanması zorunlu bir ihtiyaç olarak karşımıza çıkmaktadır. Çalışmada, sürdürülebilirlikle ilgili bilgilerin raporlama gerekliliklerine ilişkin olarak taslak sürdürülebilirlik raporlama standartlarında (UFRS S1 ve UFRS S2) yer verilen açıklamalardan hareketle BIST sürdürülebilirlik 25 endeksi işletmelerinin finansal raporlarının ve ilgili diğer raporlarının bu zorunluluklara uyum derecesi betimsel analiz ve içerik analizi ile incelenmiş ve sürdürülebilirlikle ilgili bilgilerin raporlamasında tespit edilen önemli noktalar ve eksiklikler açıklanmıştır.

JEL Classification : M41 , M48

EXTENDED ABSTRACT


As a result of developments in environmental, social, and governance areas, sustainability has become very important in corporate governance. Negative aspects such as the COVID-19 pandemic, climate crises, and waste problems experienced in recent years have resultantly increased enterprises’ governance risks. Sustainability has great importance in terms of economic as well as environmental and social aspects. In this regard, investors want to invest in things with sustainable value. Communication between businesses and financial statement users is provided by reporting, and the need for sustainability reporting in addition to financial reporting increases daily. For this purpose, the International Sustainability

Standards Board (ISSB) published the International Financial Reporting Standards IFRS S1 General Requirements for Disclosure of Sustainability-Related Financial Information (Exposure Draft) Standard and the IFRS S2 Climate-Related Disclosures (Exposure Draft) Standard on March 31, 2022, with the Turkish version of these standards having been made available to users in Türkiye.

This study first explains the concept of sustainability and then examines the IFRS S1 and S2 Exposure Draft Standards in detail under the heading of reporting sustainable information. The study’s research includes the 25 enterprises on the BIST Sustainability 25 Index in its analysis. These enterprises have high sustainability performance and high liquidity. The fields

of activity these enterprises are involved in include transportation, storage, retail, finance, construction, electricity, gas, water, information, and communication. The study examines the financial reports, sustainability reports, annual reports, integrated reports, and assurance reports from these enterprises for 2021. Table 1 shows the distributions of the analyzed reports according to type. In addition, Figure 2 shows the sectoral distributions of the examined enterprises, and Figure 3 shows their total asset sizes, and Figure 4 shows their total net sales.

Descriptive and content analyses have been used side by side in the research. The first core process in the IFRS S1 and IFRS S2 (Exposure Draft) Standards is governance. Within the scope of the descriptive analysis in this context, the governance criteria have been divided into 8 sub-criteria by taking into account the governance requirements specified as the information that enterprises need to disclose under the governance heading in the IFRS S1 and IFRS S2 (Exposure Draft) Standards. The presence of each criterion was first examined through the sustainability reports of the 25 enterprises that are the subject of the research. For enterprises that do not have a sustainability report, their annual reports and/or integrated annual reports have been taken into account. Accordingly, each criterion found to be present in the reports was scored as “1”, and each criterion found to be absent was scored as “0”. The total number of criteria that were determined to be present and scored as “1” for each enterprise was calculated as a fraction by proportioning the total number of governance criteria to the total number of criteria.

As the second part of the research, the content analysis examined the strategy, risk management, and metrics and targets criteria regarding the IFRS S1 and IFRS S2 (Exposure Draft) Standards. This section only conducted a qualitative content evaluation study. In addition, the 2021 annual financial reports of the enterprises were analyzed using the content analysis method in terms of their financial information disclosures related to sustainability. In this direction, the content analysis was carried out on the enterprises’ financial reports, as well as on their sustainability reports and other reports regarding sustainability disclosures. This was done in an attempt to determine under which section or heading, for which subjects, and to what extent the enterprises included explanations regarding sustainability on their financial reports.


PDF View

References

  • ACCA, Companies’ readiness to adopt IFRS S2 climate-related disclosures, (2022). Erişim Tarihi: 28.01.2023, https://www.accaglobal. com/gb/en/professional-insights/global-profession/readiness-for-IFRS-S2.html , 4-58. google scholar
  • Akdoğan, N., Özerhan, Y. & Sultanoğlu, B. (2023). İklimle ilgili açıklamalar standart taslağı ıfrs s2: bıst sürdürülebilirlik endeksindeki işletmelere olası etkileri. Muhasebe Bilim Dünyası Dergisi, 25, 96-128. google scholar
  • Avi, M. S. (2022). Climate impact and corporate communication: The European and Italian situation and the Issb proposal outlined in exposure drafs S2 climate-related disclosure. Journal of Economics, Finance and Management Studies, 5(05), 1173-1196. google scholar
  • Cavlak, H. (2022). İklim ile ilişkili hususların finansal etkisi ve finansal raporlarda sunumu: Bir havayolu işletmesi örneği. Erciyes Akademi, 36(3), 1167-1190. google scholar
  • Chapin, F. S., Torn, M. S. & Tateno, M. (1996). Principles of ecosystem sustainability. The American Naturalist, 148(6), 1016-1037. google scholar
  • Dyllick, T., & Hockerts, K. (2002). Beyond the business case for corporate sustainability. Business Strategy and the Environment, 11, 130-141. google scholar
  • Gray, R. (2010). Is accounting for sustainability actually accounting for sustainability...and how would we know? An exploration of narratives of organizations and the planet, Accounting, Organizations and Society, 35(1), 47-62. google scholar
  • Global Reporting Initiative Universal Standards (2021), Erişim adresi: https://www.globalreporting.org/media/zaıil2g3/pıblic-faqs-ıniversal-standards.pdf google scholar
  • Herzig, C. & Schaltegger, S. (2006). “Corporate Sıstainability and Reporting”, Schaltegger, S., Bennett, M. & Bırritt, R. (Ed.), Sustainability Accounting and Reporting, Berlin: Springer. google scholar
  • Indyk, M. (2022). Are the companies prepared for sıstainability reporting ınder the ED Ifrs S1 and S2? Evidence from Poland, Audit Financiar, 4(168), 641-654. google scholar
  • Özbay, D. (2019). Türkiye’de finansal olmayan raporlama ve gelişim trendi. Uluslararası Yönetim İktisat ve İşletme Dergisi, 15(2), 445-462. google scholar
  • Özerhan, Y. & Sıltanoğlı, B. (2018). Sürdürülebilirlik raporı kapsamında çevresel bilgilerin raporlanması ve güvence denetimi, Muhasebe ve Denetime Bakış, 53, 55-76. google scholar
  • Pratama, A., Jaenıdin, E. & Anas, S. (2022). Environmental, social, governance - sıstainability disclosıre ısing international financial reporting sıstainability standards S1 in soıtheast asian companies: A preliminary assessment. International Journal of Energy Economics and Policy, 12(6), 456-472. google scholar
  • Saban, M., Küçüker, H. & Küçüker, M. (2017). Kırımsal sürdürülebilirlik ile ilgili raporlama çerçeveleri ve sürdürülebilir raporlamada mıhasebenin rolü. İşletme Bilimi Dergisi, 5(1), 101-115. google scholar
  • Signitzer, B. & Prexl, A. (2008). Corporate sıstainability commınications: Aspects of theory and professionalization, Journal of Public Relations Research, 20(1), 1-19 google scholar
  • Sıltanoğlı, B. & Akdoğan, N. (2020). IIRC çerçevesi kapsamında entegre raporlardaki içerik öğelerinin Türkiye ve ılıslararası karşılaştırılması ve entegre raporların düzenlenmesinde sürdürülebilirlik raporlarındaki bilgilerin kıllanımı, Muhasebe ve Bilim Dünyası Dergisi Özel Sayısı, 22, 20-46. google scholar
  • Sıta, A., Toth, A. & Borbely, K. (2022). Presenting climate-related disclosıres in the aıtomotive sector: Practical possibilities and limitations of cırrent reporting prototypes and methods. Chemical Engineering Transactions, 94, 379-384. google scholar
  • Thai, K., Xı, Y. & Herbohn, K. (2022). Reporting and Assırance of Material Climate Risks: Evidence from Aıstralia. AASB Research Centre Working Paper 6, Erişim adresi: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4307685 google scholar
  • Tırhan, G. D., Özen, T. & Albayrak, R. S. (2018). Kırımsal sürdürülebilirlik kavramı, stratejik önemi ve sürdürülebilirlik performansı ölçümü: Literatür çalışması. Ege Stratejik Araştırmalar Dergisi, 9(1), 17-37. google scholar
  • Tüyen, Z. (2020). İşletmelerde sürdürülebilirlik kavramı ve sürdürülebilirliği etkileyen etmenler. İstanbul Ticaret Üniversitesi Sosyal Bilimler Dergisi, 19(37), 91-117. google scholar
  • UFRS S1 Sürdürülebilirlikle İlgili Finansal Bilgilerin Açıklanmasına İlişkin Genel Hükümler, Erişim adresi: https://www.kgk.gov.tr/ Portalv2Uploads/files/Dıyırılar/v2/Sırdırılebilirlik/S1%2030_11_2022.pdf google scholar
  • UFRS S2 İklimle İlgili Açıklamalar, Erişim adresi: https://www.kgk.gov.tr/Portalv2Uploads/files/Dıyırılar/v2/Sırdırılebilirlik/ S2%2030_11_2022.pdf google scholar
  • United Nations (1987). World Commission on Environment and Development (WCED), Oır Common Fıtıre,, Erişim adresi: https:// sıstainabledevelopment.ın.org/content/docıments/5987oır-common-fıtıre.pdf google scholar
  • United Nations (2008). Report of the World Commission on Environment and Development: Our Common Future, Erişim adresi: https:// sustainabledevelopment.un.org/content/documents/5987our-common-future.pdf google scholar
  • Villiers, C., Torre, M. L. & Molinari, M. (2022). The Global Reporting Initiative’s (GRI) past, present and future: critical reflections and a research agenda on sustainability reporting (standard-setting). Pacific Accounting Review,34(5), 728-747. google scholar
  • Yavuz, V. A. (2010). Sürdürülebilirlik kavramı ve işletmeler açısından sürdürülebilir üretim stratejileri. Mustafa Kemal Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 7(14), 63-86. google scholar
  • Zhou, S. (2022). Reporting and assurance of climate-related and other sustainability information: A review of research and practice. Australian Accounting Review, 32(3), 315-333. google scholar

Citations

Copy and paste a formatted citation or use one of the options to export in your chosen format


EXPORT



APA

Bi̇rcan, G.N., & Özcan, İ. (2023). Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index. Journal of Accounting Institute, 0(69), 24-43. https://doi.org/10.26650/MED.1253502


AMA

Bi̇rcan G N, Özcan İ. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index. Journal of Accounting Institute. 2023;0(69):24-43. https://doi.org/10.26650/MED.1253502


ABNT

Bi̇rcan, G.N.; Özcan, İ. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index. Journal of Accounting Institute, [Publisher Location], v. 0, n. 69, p. 24-43, 2023.


Chicago: Author-Date Style

Bi̇rcan, Gözde Nezriye, and İrem Özcan. 2023. “Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index.” Journal of Accounting Institute 0, no. 69: 24-43. https://doi.org/10.26650/MED.1253502


Chicago: Humanities Style

Bi̇rcan, Gözde Nezriye, and İrem Özcan. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index.” Journal of Accounting Institute 0, no. 69 (Jul. 2024): 24-43. https://doi.org/10.26650/MED.1253502


Harvard: Australian Style

Bi̇rcan, GN & Özcan, İ 2023, 'Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index', Journal of Accounting Institute, vol. 0, no. 69, pp. 24-43, viewed 20 Jul. 2024, https://doi.org/10.26650/MED.1253502


Harvard: Author-Date Style

Bi̇rcan, G.N. and Özcan, İ. (2023) ‘Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index’, Journal of Accounting Institute, 0(69), pp. 24-43. https://doi.org/10.26650/MED.1253502 (20 Jul. 2024).


MLA

Bi̇rcan, Gözde Nezriye, and İrem Özcan. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index.” Journal of Accounting Institute, vol. 0, no. 69, 2023, pp. 24-43. [Database Container], https://doi.org/10.26650/MED.1253502


Vancouver

Bi̇rcan GN, Özcan İ. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index. Journal of Accounting Institute [Internet]. 20 Jul. 2024 [cited 20 Jul. 2024];0(69):24-43. Available from: https://doi.org/10.26650/MED.1253502 doi: 10.26650/MED.1253502


ISNAD

Bi̇rcan, GözdeNezriye - Özcan, İrem. Considerations about Adapting to IFRS S1 and S2 With Regard to Sustainability Reporting: Research Regarding Enterprises on the BIST Sustainability 25 Index”. Journal of Accounting Institute 0/69 (Jul. 2024): 24-43. https://doi.org/10.26650/MED.1253502



TIMELINE


Submitted20.02.2023
Accepted25.05.2023
Published Online29.08.2023

LICENCE


Attribution-NonCommercial (CC BY-NC)

This license lets others remix, tweak, and build upon your work non-commercially, and although their new works must also acknowledge you and be non-commercial, they don’t have to license their derivative works on the same terms.


SHARE




Istanbul University Press aims to contribute to the dissemination of ever growing scientific knowledge through publication of high quality scientific journals and books in accordance with the international publishing standards and ethics. Istanbul University Press follows an open access, non-commercial, scholarly publishing.