...how would you fix the growing investor expectation gap around corporate reporting?
The IASB are looking at revising their management commentary practice statement to help and are thinking about both unrecognised intangibles and the impact the environment could have on long-term sustainability.
Both of these are part of what I believe to be a growing investor expectation gap. However, I am yet to be convinced that the IASB are the right people for the job. They have limited experience in both of these areas and I think they should probably "stick to the knitting".
What do you think?
‘There are many elements of value creation which are important to the investor but which are not adequately captured in the financial statements. Investors need to understand a company’s business model and its strategy for long-term value creation. They need to understand the intangibles that are vital to their business model. ‘And, yes, sustainability issues can also be important for long-term value creation in certain industries, just think of mining and car manufacturing,’ Hoogervorst said.