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Feyz International is a dynamic company providing consulting services, event management, and investment support to customers locally and internationally across Europe and beyond. Founded by a diverse team of global development experts, we have successfully supported numerous development projects in Switzerland, France, Turkey, and neighboring regions since 2018. About Us Feyz International is a dynamic company providing consulting services, event management, and investment support to customers locally and internationally across Europe and beyond. Founded by a diverse team of global development experts, we have successfully supported numerous development projects in Switzerland, France, Turkey, and neighboring regions since 2018. Our Activity Feyz International is a European management consulting firm delivering strategic guidance and customized solutions to businesses worldwide. Founded in 2018, we specialize in legal, financial, and tax advisory services, along with corporate event management. We deliver large-scale transformation projects for an expansive global portfolio of customers across diverse industries. Leveraging analytical depth and technical expertise, our teams operate across Europe to resolve complex challenges and enhance operational efficiency. Our model merges strategic insight with hands-on experience, delivering a comprehensive suite of strategic, operational, and regulatory advisory services that drive organizational excellence and measurable, lasting results for our customers. Beyond consulting services, Feyz International hosts tailored summits, conferences, and executive events designed to foster innovation and deliver actionable solutions. Through exclusive partnership opportunities, we enable our customers to position their brands alongside our global platforms and access a network of over 5000+ C-level executives. These high-level engagements facilitate strategic dialogue, in-depth knowledge sharing, and the development of sustainable partnerships. Our Mission Connecting leaders to shape a better future. At Feyz International, we connect passionate professionals to create insightful solutions to any challenges they may face. Our ability to anticipate, comprehend and provide a deep understanding of our customers' transformation, strategic and planning needs leads to sustainable results and long-term partnerships. Our commitment to individual empowerment and continuous development enables us not only to best serve our customers, but also to better influence our own destiny, shaping the future of society. Our Vision To deliver authentic solutions grounded in commitment and perseverance, fostering sustainable business value. We strive to be known for our ability to find genuine, simple and sustainable solutions to our customers' most compelling opportunities and complex challenges. By earning trust through bold actions, our associates will be recognized for their success in delivering world-class solutions and maximizing customer satisfaction. To realize this vision, we will be at the forefront of staff development and sustainable business transformation. Our Events

For entrepreneurs to flourish, they need funding: venture capital is financial capital provided to early-stage, high-potential, high-risk, growing entrepreneurial companies. Venture capital is particularly attractive for new companies with a limited operating history that are too small to raise capital in the public markets, and have not reached the point where they are able to secure a bank loan or complete a debt offering The role of venture capital securities in entrepreneurship For entrepreneurs to flourish, they need funding: venture capital is financial capital provided to early-stage, high-potential, high-risk, growing entrepreneurial companies. Venture capital is particularly attractive for new companies with a limited operating history that are too small to raise capital in the public markets, and have not reached the point where they are able to secure a bank loan or complete a debt offering. In exchange for the high risk that venture capitalists (VCs) shoulder by investing in smaller and less mature companies, venture capitalists usually get a significant portion of the company's ownership (and consequently their value). Once a VC decides to invest in a venture, the involved parties need to settle on a deal structure. When negotiating the deal structure, parties need to keep a few considerations in mind: The deal structure needs to protect the VC against losses and should encourage entrepreneurs to work hard to make the venture a success. Most VC investments are illiquid, which means that unlike shares of listed companies, they cannot be sold very easily. Finally, most investments are characterized by asymmetric information. In general, the entrepreneur knows more about the venture than the investor. VCs typically use convertible preferred equity to finance ventures. As the name suggests there are two important features of these securities: conversion and preferred. Investors of convertible preferred equity have the option of either holding a debt-like claim -preferred equity or converting into common equity. Converting into common equity implies sharing ownership in the venture with the entrepreneur. Preferred terms make it similar to a loan (debt), gives holders a right to interest payment (dividends) and additionally gives preference in payments over common equity. In other words, the preferred feature ensures that preferred investors are paid before common equity holders. In a typical deal, VCs would hold preferred equity and the entrepreneur common equity, thus the VC can get paid before the entrepreneur if the venture does not do well. However, if the venture succeeds and its value increases, the VC would convert the preferred equity into common equity and share the fruits of this success with the entrepreneur. AAnother feature of VC investments is that they are done in stages. VCs would never provide all the capital upfront to a venture; instead, they would only provide sufficient capital to reach the next milestone. Once the capital has been used up, the entrepreneur has to raise another round of financing to reach the next milestone. The advantage of staging is that VCs can stop financing if the venture is not doing well. It can also be advantageous for the entrepreneur, as the terms can be made more favorable to them if their venture is successful. Staging also helps reconcile the aforementioned asymmetric information levels between entrepreneurs and VCs, since future investments are only made based on past outcomes. Finally, in addition to providing capital, VCs also monitor and guide the venture. The structure of most deals is designed to ensure the monitoring role of VCs. While VCs do not hold the majority of shares, they would have the right to nominate members to the board of directors. These rights help the VC monitor progress and guide the venture and gives them the power to replace managers if operations are not going smoothly. Having discussed the general features of VC investments, we will now explore details of some specific securities used in VC contracting. It must be noted that convertible preferred securities come in various flavors. Dr. Arcot analyzes one such security called participating convertible preferred security (PCP), used widely in venture capital contracts (Arcot, 2014). Participating convertible preferred stock gives its holders the right to be paid first (before common shareholders generally held by the entrepreneurs) and at the same time, allows them to participate in excess earnings (i.e., the cash flow after all debt and preferred claims have been satisfied) along with the common stockholder. PCP holders thus concurrently hold both a debt-like claim (preferred equity) as well as an equity claim (participation rights). However, PCP holders lose their preferred rights if they convert this PCP stock into common stock. His research explores why venture capitalists are willing to convert their PCP stock into common equity and give up their preferred rights. He proposes a signaling model for PCP stock based on its role in venture capital exits. The two major forms of exits observed in venture capital are the initial public offerings (IPOs) and the trade sale. IPOs are exits where shares of the venture are sold to investors and then listed on the stock market and trade sale is a transaction in which a venture is sold to another company. Typically, a PCP stake is converted into common equity during an IPO exit, but is not converted in a trade sale exit. The model shows that VCs can signal the quality of their venture in an IPO by converting their PCP stake into common equity and giving up some of their cash flow rights. By giving up something during an IPO, VCs are signaling to investors that the venture is of a high quality. Signaling is of particular importance in an IPO, because in an IPO shares are sold to new investors who do not have access to documents to analyze the venture’s performance. Investors in an IPO typically have to rely on a bank to perform the due diligence and hence are thus relatively uninformed about the venture. In contrast, potential trade buyers are given access to documents, which they can analyze to reach conclusions about the venture’s quality. Since trade buyers typically come from the same industry as the venture, they are likely to have industry knowledge and are better equipped to interpret the information provided. When exit is through an IPO, the entrepreneur retains control of the firm. Thus, when the firm value is high, an IPO exit rewards the entrepreneur and should be the preferred exit route. However, the VC may be reluctant to take that route, given that investors in an IPO are less informed and the VC may not get the full value for his stake. When the firm value is high, the VCs may prefer to target investors who are more informed and get a higher value for their stake. In other words, exit through a trade sale. However, the interests of VCs and entrepreneurs are more easily aligned when the VCs convert their PCP stakes into common shares and exit through an IPO. Venture capitalists investing in start-ups use sophisticated financial instruments to structure their investments. This article provides a rationale for the use of one such instrument, PCP stock, based on the venture capitalist’s exit strategy. In doing so, it makes a connection between the exit route and entrepreneurial effort. This highlights factors that have direct implications for the incentives of venture capitalists to invest in ventures and entrepreneurs to exert effort to make them a success. by Sridhar Arcot , 04.01.22 Source: Knowledge Lab

Library WHY CYBER RISK ASSESSMENTS SHOULD BE A PART OF YOUR BUSINESS STRATEGY Every day brings with it the news of yet another company falling victim to a cyberattack. The costs the affected businesses face are enormous: lost critical data, stolen assets and damaged reputations... HOW SECURE ACCESS SERVICES EDGE SECURITY WILL TRANSFORM NETWORKS During a media event at Netskope’s SASE Week, Steve Riley, the discussion moderator and field chief technology officer for Netskope, asked, “What’s the driving force for SASE? Why now? What’s changed?”... THE ROLE OF VENTURE CAPITAL SECURITIES IN ENTREPRENEURSHIP For entrepreneurs to flourish, they need funding: venture capital is financial capital provided to early-stage, high-potential, high-risk, growing entrepreneurial companies. Venture capital is particularly attractive for... CYBERSECURITY 2023: CLOUD SECURITY IS KEY ISSUE FOR COMPANIES What challenges do companies currently face regarding security? What is their cybersecurity strategy for the future? And what role does digital sovereignty play in this?... Coming soon...

During a media event at Netskope’s SASE Week, Steve Riley, the discussion moderator and field chief technology officer for Netskope, asked, “What’s the driving force for SASE? Why now? What’s changed?” How secure access services edge security will transform networks During a media event at Netskope’s SASE Week , Steve Riley, the discussion moderator and field chief technology officer for Netskope , asked, “What’s the driving force for SASE? Why now? What’s changed?” The short take is that we are in the midst of a digital transformation, with a stronger reliance on mobile and cloud computing than ever before, according to various attendees, and we need to implement secure access services edge (SASE) now to properly address data security and networking issues that are quickly approaching. Jason Clark, chief strategy officer at Netskope, said that business has been moving to a cloud-based framework and that cloud adoption has been accelerated by the pandemic. “Data is now sitting on a CPU that you don’t own or control because it’s on the cloud, and it’s being transmitted on a network — or the internet — that you don’t own, and the users are off the network. The security teams are being stretched by this,” he said. Clark stresses that moving to SASE means “a repositioning of security to consolidate to one new security inspection point. It’s a smart reset.” When Ed Amoroso, founder, and CEO of cybersecurity consultancy TAG Cyber , was asked why he was advocating for a move to SASE, he used an easy-to-visualize model. “Hub and spoke networks consolidated and brought everything to the datacenter. Now data is scattered among apps, cloud, and different work clouds so the hub and spoke doesn’t make any sense anymore,” he said. “By conceptualizing what you need in your mind, you start putting together SASE. We’re at a time when people need different networks that can be controlled from the cloud. Anyone listening can self-generate that SASE is required just by thinking about how we use networks today.” Meeting network engineers’ needs After, Riley poised two thought-provoking questions — “If everything is on the cloud, is there a network to manage?” and “If there is no datacenter, are there now many centers of data?” — George Gerchow, chief security officer at Sumo Logic , led a discussion on the importance of focusing on data security and encryption. Gerchow stressed repeatedly the need for collaboration with control, saying, “You have to have availability, but that availability has to have seamless security. Availability matters because people have to use their services, but if you don’t have security to go with it, good luck, because it can be over in an instant.” Clark suggested that there are two avenues in building a SASE framework: “If it’s security-led, then it’s about the data. Sometimes it’s network-led, and for networking, [then] it’s about access.” Supporting the idea of a network-led framework, Amoroso said, “Many things that have nothing to do with security are an important part of the architecture.” He pointed out that he has a stack of laptops that he still uses for each company with whom he consults because that’s the only way to access his corporate clients’ perimeter. The reality is that network engineers are probably busier than they’ve ever been, and SASE can bring about needed improvements to network access. Zero trust is adaptive trust Introducing the topic of zero trust elicited some laughter from panelists. They all proceeded to comment on the buzzword aspect of the phrase, despite much misunderstanding about what it really is. Clark summarized by saying, “It’s a framework that needs to be embedded in how we operate. It’s not binary. Trust is not on or off. Zero trust has a zero to five scale in my mind.” Riley added, “Zero is the starting point, but ultimately you’ll have to extend some level of trust in order for some level of interactivity to occur.” He followed that up by suggesting that the term “adaptive trust” would be more accurate, which was met with panel agreement. Clark described a zero-trust relationship as allowing its users to “give the least amount of access as possible, as much as possible, so that bad things can’t happen.” Gerchow added that zero trust is a fabric of many things, and that it entails working closely with vendors and partners to stop anything that isn’t supposed to happen. The great SASE migration Overall, the panel seemed to largely focus on a key question, “How do we convince the C-Suite?” Panelists agreed that SASE is the future of data security and secure access, but disagreed on how long it will take for a cloud adoption tipping point moment. Clark brought up the importance of the shared responsibility model, where you can control what user has access to, as well as what data is included. He said that a company should have its own standard for considering third-party risk before granting any outside agency access to its cloud-based framework. It was Amoroso who summarized the task of transitioning to SASE best. “It’s like if you have a new house, and you move your messy garage one piece at a time into the new garage, but you want to keep it organized as you go,” he explained. “The data that needs to move to the cloud is scattered. There are companies dealing with lost data. I think it’ll all eventually get to the cloud, but moving it is complicated.” by Corinna Makris , 06.11.21 Source: www.venturebeat.com

How can organizations do good (help the environment) while doing well (boosting economic growth)? While both worthy goals, they can be at odds with each other, creating a dilemma for organizations who wish to both contribute to environmental sustainability while maintaining economic growth.  DOING GOOD WHILE DOING WELL: THE CASE OF BUSINESS IT INITIATIVES How can organizations do good (help the environment) while doing well (boosting economic growth)? While both worthy goals, they can be at odds with each other, creating a dilemma for organizations who wish to both contribute to environmental sustainability while maintaining economic growth. All that glitters is not green Information technology (IT) is a major driver of economic and social development, but such advancement comes at a high environmental cost. Organizations’ reliance on IT has led to increased computing power and the development of large data centers that provide analytics and cloud computing services. These result in increased energy consumption, higher carbon emissions, and more electronic waste. This has led to the development of green IT initiatives to address the environmental consequences, meaning IT products and services that reduce the negative impact and improve sustainability. The existing research supports the idea that launching green IT efforts can improve sustainability outcomes, for example by managing energy consumption. Other examples of green IT initiatives include powering data centers with renewable energy sources, reducing waste from out-of-date computing equipment, and encouraging telecommuting/remote administration for reduced transportation-related emissions. There are a number of ways to go about a green IT initiative, but they all require a concerted effort from staff and involving IT processes and IT products. This is likely to be a significant technological trend with wide-reaching social implications. However, all that glitters is not green, and implementing green IT measures comes with complications such as disruption to existing systems, unpredictable returns and market demand, cost, and how stakeholders will react. This leads to the dilemma between doing good while doing well: while companies may wish to do good by implementing green IT initiatives, they may have legitimate concerns about how this will affect their bottom line (doing well). Indeed, much of the research has focused on the sustainability implications and less on the economic ones. This dilemma led the researchers to examine the drivers that impact an organization’s motivation to adopt green IT initiatives and their link to this reconciliation between sustainability and profit. What drives this process? To explore this question, the researchers conducted a qualitative study on eight organizations in China and Singapore, as it is crucial to explore how green IT implementation plays out in the real world as opposed to an experimental setting. The companies operated in telecommunications and IT-related industries. All eight were large companies with over 3000 employees, and all eight were pioneers of green technology. The research team used a multi-prong data collection approach, conducting interviews and clarifying information via emails and phone calls, field observations, and archival data. They looked at both internal and external drivers, separating them into three categories: competitiveness, legitimation, and ecological responsibility. Internal drivers, or organizational drivers, include factors like stakeholders’ attitudes, economic considerations, and technology skills. External drivers include factors like policy and industry pressures, like regulations on waste disposal and energy consumption. Breaking it down further, competitiveness is the link between ecological actions and long-term profitability; legitimation is the organization’s drive to align its actions within a certain set of norms or regulations; and ecological responsibility refers to an organization’s thoughts about its duty to society and its values. Looking at the results, the researchers found that green IT practices were seen as essential strategic considerations for these companies. They also found that organizations did not always manage to reconcile the gap between sustainability and profit through meeting the objectives of competitiveness, legitimation, and ecological responsibility. For companies that noted a significant amount of government pressure, an external driver, only a middling level of reconciliation was achieved. Organizations tended to have one main driver, like government pressure for Chinese companies and corporate social responsibility for the Singaporean companies, but were also motivated by the other drivers. Overall, the organizations tended to be most motivated by cost reduction, market drivers, government pressure, and corporate social responsibility. For reconciliation of sustainability and profit, the researchers found that the time frame matters: while IT initiatives tend to require a short-term investment, they will bring long-term benefits that surpass the initial investment. The strategy deployed also plays a role: one company invested in hybrid cloud computing, which set them apart from the competition, which will ultimately improve profits. Having a green image is also a competitive advantage, as it can boost customer satisfaction. Additionally, the dilemma becomes less of an issue in cases where companies experience external pressure, like from the government or external stakeholders. If going green is essential for market success, the financial investments become less of a consideration and more of a requirement. This shows that the dilemma can play out in different ways, and it is important to consider how both internal and external factors will impact the implementation of a green IT strategy. Takeaways IT services are ubiquitous in business and management, meaning that organizations and managers need to prioritize the implementation of green IT. Organizations may have different motivations for doing so, motivations that may fall into the categories of competitiveness (economic pressure), legitimation (shifting norms) or ecological responsibility (doing the right thing). These categories can include both external and internal factors. In practice, this highlights two main ways to motivate companies to implement green IT practices: A combination of pressure from the government and corporate social responsibility obligations Aligning green IT measures with the goal of improving profits by satisfying market demand and reducing operating costs The researchers note that the latter is more sustainable, but that the former may be able to stimulate progress by implementing incentives (tax breaks) or punishments (high energy costs). The climate crisis is increasingly urgent, and helping the environment requires an “all-hands on deck” approach. With soaring IT needs and their accompanying environmental consequences, green IT processes are likely to be a trend that won’t go away any time soon. With this research, we gain a better understanding of what motivates organizations to take on green IT initiatives and how they can reconcile “doing good” with “doing well”, enriching our understanding of the drivers of business IT initiatives, an understanding that can help organizations seeking to take such initiatives themselves. Further reading Yang, X., Li, Y., & Kang, L. (2020). Reconciling “doing good” and “doing well” in organizations’ green IT initiatives: A multi-case analysis. International Journal of Information Management, 51, 102052. by Yan Li , 17.05.21 Source : Knowledge Lab Essec

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Have you ever wondered why consumers tend to make suboptimal financial decisions, and why financial firms are often in a position to exploit them? CONSUMER FINANCE IN THE DIGITAL AGE: LEVERAGING BIG DATA AND TECHNOLOGY TO PERSONALIZE PROTECTION Have you ever wondered why consumers tend to make suboptimal financial decisions, and why financial firms are often in a position to exploit them? Clearly, this is due in part to consumers’ biases and limited rationality. As consequence, even well-meaning policy interventions have often regulated for rational consumers and made them worse rather than better off. However, recent developments in behavioral science and economics seem to have made their way to traditional regulatory interventions. And while the combination of behavioral insights and big data analysis is raising issues relating to privacy and equality before the law, it is also opening up the possibility of tailoring the regulation of financial market behavior to more empirically valid characteristics. Consuming Financial Products Retail clients, you, me, we all engage with the financial system in various ways. We open accounts, we get personal loans, we may even be tempted to invest in bonds or shares. Some of the opportunities in the financial market are believed to dramatically improve our well-being. Pension-related products are one striking example: they help up save effortlessly for times when we will not have an income anymore. However, financial markets are complex and also expose consumers to greater risks than other marketplaces. Some risks are product specific and derive from the speculative nature of the instrument. Other risks are more general and related to consumers’ pattern of behavior. Even products such as insurance products that are not indexed to the ups and downs of the financial market do expose financial consumers to ill-suited or expensive choices. Decision-making and the Human Brain It is now widely recognized that individual cognitive processing has limited capacity. The human brain deploys mechanisms to economize on cognitive processing in decision-making: this saves time but results in systematic errors in decision-making, which might not happen if the person was given unlimited time and the analytic resources to make these choices. Therefore, consumers make predictably costly mistakes in financial markets: they buy high and sell low, invest in attractively presented instruments they do not understand, and pay excessive fees. The Myth of Rules of Thumb and the Rational Consumer If we want to protect and empower the financial citizens that we are, close attention should be paid to consumers’ behaviors, to their imperfect analyses and distorted judgments. Let us not forget that many existing rules are written with a fictional (rational) consumer in mind: someone who reads labels and disclosures, takes the time to scrutinize contracts, and checks the terms and conditions. In reality, we are nothing like the fictional consumer. Instead, we use shortcuts to make decisions, relying on intuition rather than deliberation. Thus, many potential errors, anomalies or biases in consumer decision-making may be explained by the use of rules of thumb leading to incorrect beliefs. We are unlikely to make an active choice when one option is a default (‘inertia’). An example of this is automatically renewable contracts, such as are often found in banking services. It has also been established that we can only deal effectively with a limited amount of information (‘information overload’). For this reason, it is not sensible to throw into the terms and conditions of loan agreements more information than consumers can process. Another example is present bias. This causes us to discount costs that seem distant in the future (‘hyperbolic discounting’). For example, a credit card with a low introductory teaser interest rate and high long-term interest rate is regarded as attractive, irrespective of the total cost. A last example, ‘optimism bias’ can lead us to misjudge the amount of use we make of a service: thus we might believe that we will never be in a situation where we need an expensive overdraft. Errors of this kind can result in choosing a contract that does not suit our needs. Leveraging Big Data and Technology to Personalize Protection Businesses have long been aware of this set of behaviors and regulations have started to take into account and incorporate insight from behavioral studies. What would be useful is to bridge the gap with Big Data, which is just another key to understanding consumer behavior. The power of Big Data and associated predictive analytics could be used to improve the efficiency of consumer law. While heterogeneity among consumers often means that regulations are over- and under-inclusive, the rise of Big Data has significantly decreased the costs associated with creating and administering personalized legal rules tailored to specific individual profiles or circumstances. This is just one example out of many more. In short, the combination of behavioral economics and Big Data analysis opens up the possibility of tailoring the regulation of market behavior to more empirically valid characteristics, and to personalize it. This exciting prospect also opens up major questions, relating in particular to how privacy can be ensured and how justice can be achieved. Nevertheless, private law can potentially embrace and harness these insights, and use them to solve problems such as unfair terms or debt payment issues. by Geneviève Helleringer , 21.09.21 Source : Knowledge Lab Essec

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Corporate social responsibility is an increasingly popular topic in the corporate world and beyond, highlighting a need for best practices and a stronger understanding of what it really means to be a sustainable business. For this to occur, we need ways of measuring corporate sustainability: social accounting is one way of doing so. Adrian Zicari, professor at ESSEC, explains its merits, as well as its limitations, in a recent chapter in the Handbook on Ethics in Finance. SOCIAL ACCOUNTING: A TOOL FOR MEASURING CORPORATE SUSTAINABILITY Corporate social responsibility is an increasingly popular topic in the corporate world and beyond, highlighting a need for best practices and a stronger understanding of what it really means to be a sustainable business. For this to occur, we need ways of measuring corporate sustainability: social accounting is one way of doing so. Adrian Zicari, professor at ESSEC, explains its merits, as well as its limitations, in a recent chapter in the Handbook on Ethics in Finance. First, a primer: social accounting refers to the measurement of an organization’s social and environmental performance, recognizing the need to go beyond measuring economic impact only. There are a number of indicators that can be used, for example the disclosure of pollution information or the composition of the company’s workforce, among others. The list of indicators goes on, as assessing social and environmental information is a complex matter. This makes the scope of social accounting quite broad, and also leads to the question of balancing comprehensiveness and comprehension: more information is not necessarily better, as it can make reports hard to understand. Many of these indicators are not measurable in financial terms, so practitioners of social accounting need to go beyond conventional accounting and gather information from different sources. This requires a significant investment. As a result, social reports are more common in bigger companies. Dr. Zicari explored five issues (1): The motivation behind corporate disclosure of social & environmental information The use of social accounting internally for management purposes The link between social accounting and financial performance Whether or not regulation contributes to sustainability The potential that social accounting has for contributing to sustainable practices Disclosure on social and environmental information Today, the disclosure of social and environmental information is usually voluntary, though some European countries have recently implemented regulations. For instance, some companies in France have to present a “déclaration de performance extra-financière”. This means that in many cases, companies can pick and choose what, how, and when they disclose. This makes it difficult to compare companies, as there are many different frameworks in use. If it is not mandatory, why do companies disclose this kind of information? One reason is to show their legitimacy, i.e. living up to social expectations. Others may have a more “defensive” strategy in play, like if they are under fire from environmental agencies. If they do produce social reports, their motivations may impact the content. Researchers have noted that companies with poorer environmental performance tend to talk more about their environmental projects (2) and use more optimistic language (3). In other words, companies tend to be strategic when deciding what they share and how they share it, and their motivation is often based on protecting or enhancing the company’s reputation. This does not necessarily mean that companies are acting in bad faith, but it does mean that they may not disclose all their social and environmental indicators. Dr. Zicari notes that this can lead to tensions between companies and stakeholders: companies may not disclose all information, while stakeholders may seek more transparency. Should disclosure be mandatory? Corporate social responsibility initiatives and social accounting alike are typically voluntary, but there are increasingly calls for more mandatory reporting. This would be beneficial in that it could increase comparability, standardize reporting, boost the scope of information shared, result in better-informed consumers. One way to increase regulation is through “soft-law” initiatives, meaning the use of frameworks that are voluntary, but provide structure, like GRI, SASB, and Integrated Reporting. If a company says that it complies with one of those, then it has to abide by that and provide the according data. This could also boost stakeholder engagement by providing a reference point and also make it easier to compare companies, as currently comparisons are hindered by the many different frameworks out there. Another option is the use of “hard-law”, legally-binding regulations. One example of this is the Directive 2014/95/EU of the European Union, under which companies with over 500 employees disclose non-financial information. Some initial research suggests that this could have a negative impact on information quality, as companies prefer to share good news (4). Increased regulations on social reporting could help, but regulation alone will not ensure disclosure, nor does increased disclosure lead to increased sustainability. This suggests that while regulation could be useful, it does not replace the need for stakeholders to advocate for sustainability. Using social accounting internally Much of the discussion has focused on disclosure to external parties. What about the goings-on inside the company? Internal indicators can help managers make decisions that align with CSR indicators. However, since the indicators can be hard to decipher, managers may struggle to work with them, especially as CSR work can be siloed within the organization. Companies use different approaches when using social accounting internally. An “inside-out” approach highlights the use of internal social accounting information by managers in their decision-making processes; this can be combined with the “outside-in” perspective, wherein external stakeholders use report information to inform their decisions (5). Both of these perspectives are important in striving for sustainability. To facilitate this process and also help managers interpret the information, CSR discussions should be integrated into corporate performance and dealt with across the organization, rather than being the responsibility solely of a specialized team. What is the link between social accounting and financial performance? Social accounting is not interchangeable with conventional accounting: how exactly do they relate? Their scopes are different, but there is a lot of overlap, both in content and in audience. For example, perhaps a firm makes an expenditure to make a process greener: this will be reported in Profit and Loss Statements (the cost) and in social reports (the effect of the green initiative). An investor may read both these statements, as the financial statements help evaluate the company’s potential and social reports show its environmental impact. The research is mixed when it comes to how sustainability actually impacts financial performance; as a result, managers may be unsure about the profitability of sustainable policies, even if they think the ethical rationale is strong. When measuring the situation, managers thus need to carefully consider the framework they use, and whether or not it is appropriate for the situation. Can social accounting lead to organizational change? Even if the link between sustainability and financial performance is unclear, sustainability remains a worthy goal. This means that social accounting, too, is useful, as a tool for achieving sustainability. What can it actually achieve? Some scholars (cf. 6) suggest that social accounting can inform better decision-making and facilitate teamwork. Others are less certain (cf. 7), who argue that it is mainly symbolic and may not lead to significant change. One thing is true: realizing true improvements is difficult, and the mere implementation of social accounting processes will not automatically improve sustainability. Further, over-reliance on social accounting may lead to a focus on the “small picture”, rather than truly revisiting conventional business models. While social accounting is not a silver bullet, it has shown success; the KPMG Survey of Corporate Reporting (2017) (8), studying reporting practices in 50 countries, found that social reporting is widespread, and there is a community dedicated to its improvement and implementation. Social accounting could also help with the “big picture”: while reports may highlight smaller, incremental improvements, these could inform long-term changes to conventional business practices. For example, mining: by definition a polluting activity, but nevertheless one that is necessary for industrial production. Using social accounting could give managers and stakeholders information that could help reduce the environmental impact as a short-term strategy, while preserving the need to look for long-term solutions that are better for the planet. Social accounting is necessary and helpful for improving business models. Increased disclosure illuminates managers how the company can improve and informs the company’s efforts to be socially responsible. More transparency will benefit stakeholders and empower the public. We need to remember that social accounting remains a means to an end, and it will be tested by how effectively it creates measurable change in corporate practices. Key points and takeaways Tension exists between companies and stakeholders, as the former may not share all information and the latter seek greater transparency. Regulation could improve report quality, but will not automatically improve disclosure. Managers may find it challenging to work with social and environmental indicators, leading us back to the first point: some information may not be disclosed because it is not well understood or not readily available. We still do not have a clear picture of the link between sustainability and financial performance. We must be clear-eyed on the promise of social accounting. It can help improve existing business models, but does not create new ones, and managers should be encouraged to use complementary tools. All things considered: social accounting is an increasingly helpful tool for managers and stakeholders, and can help improve corporate sustainability. References Zicari, A. (2020). The many merits and some limits of Social Accounting: Why disclosure Is not enough. Handbook on Ethics in Finance, 541–557. https://doi.org/10.1007/978-3-030-29371-0_14 Cho, C. H., & Patten, D. M. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32(7-8), 639-647. Cho, C. H., Roberts, R. W., & Patten, D. M. (2010). The language of US corporate environmental disclosure. Accounting, Organizations and Society, 35(4), 431-443. Costa, E., & Agostini, M. (2016). Mandatory disclosure about environmental and employee matters in the reports of Italian-listed corporate groups. Social and Environmental Accountability Journal, 36(1), 10-33. Burritt, R. L., & Schaltegger, S. (2010). Sustainability accounting and reporting: fad or trend?. Accounting, Auditing & Accountability Journal. Burke, J. J., & Clark, C. E. (2016). The business case for integrated reporting: Insights from leading practitioners, regulators, and academics. Business Horizons, 59(3), 273-283. Rodrigue, M., Magnan, M., & Cho, C. H. (2013). Is environmental governance substantive or symbolic? An empirical investigation. Journal of Business Ethics, 114(1), 107-129. Blasco, J. L., & King, A. (2017). The road ahead: the KPMG survey of corporate responsibility reporting 2017. Zurich: KPMG International. by Adrián Zicari , 08.06.21 Source : Knowledge Lab Essec

With the European Green Deal of December 2019 supporting long-term signals to support green investments, and the proposed European Climate Law as a framework for achieving climate neutrality, low-carbon transition has recently featured prominently in European Union (EU) policy. EU SUSTAINABLE GROWTH REGULATIONS: THE CHALLENGES OF TRANSPARENCY, COMPARABILITY, AND LEADERSHIP With the European Green Deal of December 2019 supporting long-term signals to support green investments, and the proposed European Climate Law as a framework for achieving climate neutrality, low-carbon transition has recently featured prominently in European Union (EU) policy. “Greenwashing” (pretended concern about the environment) and false advertising in the marketing of supposedly “green” products tend to undermine this objective, and these phenomena have therefore come under scrutiny. In particular, the European Commission has adopted an Action Plan on Financing Sustainable Growth, which aims at reorienting capital flows towards sustainable investment, and fostering transparency and long-termism. The Action Plan has engendered three Regulations – “Disclosure”, “Benchmark”, and “Taxonomy” – between 2019 and 2021. The new legal framework represents a worthwhile beginning, but it is not yet fully mature. The Disclosure Regulation, the Communication from the Commission on Reporting Climate-Related Information, and soft law principles targeting green bonds specifically, have together updated the 2014 requirements on non-financial information. They have increased transparency at almost all levels in the financial value-chain: issuers, investment funds, pension funds, and hedge funds, financial advisors, asset managers (all recognized as “financial market participants” in the Regulation) and rating agencies. In addition, in order to facilitate investors’ access to data, the Commission has announced in its Capital Markets Union New Action Plan the establishment of a European Single Access Point for financial and non-financial information publicly disclosed by companies. The low-carbon Benchmark Regulation sets out the requirements for “EU Climate Transition Benchmarks” and “EU Paris-aligned Benchmarks”, while the Taxonomy Regulation establishes a unified EU classification system to label economic activity as environmentally sustainable. The Taxonomy Regulation makes clear which economic activities contribute most to meeting the EU’s environmental objectives, and thereby guides – or nudges – investors towards “green” investments (on the model of energy consumption labelling, and its colour-gradient). Under Article 8(1) of the Taxonomy Regulation, certain large undertakings that were previously required to publish non-financial information pursuant to the Non-Financial Reporting Directive, are now required to disclose information to the public on how and to what extent their activities are associated with environmentally sustainable economic activities. SMEs and non-EU companies can of course decide to disclose information on a voluntary basis for the purpose of getting access to sustainable financing or for other business-related reasons. By December 31st, 2021, the Commission will report on how to label “brown” activities that significantly harm environmental sustainability, as well as activities that have low impact. The EU’s green finance taxonomy is, in other words, directed at avoiding greenwashing by establishing criteria for activities and financial instruments that claim to be environmentally sustainable or to contribute to a social objective. This legal framework lays some groundwork for comparisons and sound decision-making on behalf of investors. However, more needs to be done in terms of standardising what is reported. In practice, the way environmental information reaches capital markets remains a sticking point. Labels, indices, and principles drawn up by various uncoordinated for-profit and nonprofit organizations have multiplied, creating complexity and confusion for companies and investors. Yet, as stressed by Robert Eccles, nonfinancial information that is of the same rigor and relevance as financial information, and that is also subject to the same degree of auditability, is indispensable for capital markets to operate sustainably. Standards for nonfinancial information for companies’ environmental (as well as social, and governance) performance are important: like accounting standards, they are accepted simplified constructs to represent a company’s performance. Though imperfect (and evolving), standards enable comparability (without preventing additional information to be provided) and only fulfil their role in practice if they are mandatory. The European Financial Reporting Advisory Group’s Project Task Force issued its final report to prepare for “the elaboration of possible EU non-financial reporting standards in a revised EU Non-Financial Reporting Directive”. The European Union plans to announce its standards in April 2022. However, because the economy is global, what is really needed are standards that are also global, in addition to being independent and rigorous. The EU has shown an interest in building up an international forum: with seven countries representing 55 % of the world’s greenhouse gas emissions and half of the world’s population and GDP, the EU launched the International Platform on Sustainable Finance (IPSF). Although the IPSF is not a standard-setting body, its work is aimed at preparing the ground for the international standard setters to develop globally applicable sustainable finance standards. As noted in the first IPSF annual report, the absence of coherent definitions of green investments (taxonomies) at the global level, and the low degree of standardisation of reporting, represent a limit to green and sustainable finance worldwide. Around the world, several countries have drawn up roadmaps for sustainable finance; various public and private bodies have also introduced frameworks to enhance standardisation. However, these uncoordinated initiatives tend to reflect local priorities and stages of market development and: they cause fragmentation. The need to overcome this situation is also recognized in the EU-US agenda for global change announced a few weeks after the election of Joe Biden. The transatlantic initiative contemplates jointly designing a global regulatory framework for sustainable finance, based on the experience of the EU taxonomy. This illustrates the leading role that Europe is in a position to play as other major economies start to prioritize a coordinated response to climate change. There is obviously a risk that collective action fails and that each entity insists on imposing its own standards rather than working towards global ones. In particular, there is a risk that the EU decides that because it can mandate standards, it should do so. Unless these are endorsed by market forces, such standards might trigger a mere compliance exercise, with little benefit to companies, investors and society as a whole. If, however, the EU recognizes that it could be at the forefront of an international effort to help global standards emerge, it will be able to foster joint work with other bodies, such as the Impact Management Project, which has engaged in an effort to reconcile the various sets of existing standards, the World Economic Forum International Business Council , which can harness commitment from the corporate community, and the Sustainability Standards Board established in September 2020 to sit alongside the International Accounting Standards Board and engage in a similar role establishing international reporting standards. Were the EU to take on the role of midwife, it could deliver to the world the standards for nonfinancial information that US and Asian companies will adopt. Meanwhile a race started since the SEC proposed in March 2022 rules regarding compulsory climate-related disclosures. by Geneviève Helleringer , 28.03.22 Source : Knowledge Lab Essec

Zürich Tech Leadership Conference Tech and Data Science Executives Register Now! In-Person Event | 2023 Attending Companies Discover More Why Attend our Event? Exclusive Content – Trend-forward sessions – with tons of practical takeaways and ideas to keep you ahead in the IT space. Connections – Hundreds of seasoned IT decision makers, cyber security experts, strategists, risk managers, data heads, marketers, and more to mingle and connect with. Meet your customers, vendors, expert resources, friends and colleagues. Network with leading solution providers – As a delegate, you will experience cutting-edge technology from solution providers that can fulfil your business requirements. Showcase of Technology solutions - Gather practical perspectives from many real-world use cases shared by the market’s leading players, including early adopters and leaders from across the region. Key Topics Technology is part of our daily lives and even more so in our professional environment. The goal of this invitation-only event is to encourage discussions and dialogue on what it means to be a successful IT executive and to provide tools and strategies to assist current and emerging leaders. We urge our leaders to confidentially share their experiences and plans while hearing from inspirational and visionary speakers. We explore and share the main topics amongst which artificial intelligence, fintech, cybersecurity and the metaverse are the most popular. We encourage you to come and meet some of the biggest players when it comes to cloud computing, big data security, customer service and enterprise technology. Coming together will not only expand your networks and knowledge, you can meet the industry specialists and learn more about their expert services. Innovation & Emerging Technologies Cybersecurity, Data Protection & IT Risk Management Metaverse, Blockchain & Cryptocurrencies Leadership & Business Transformation AI, Data & Analytics Cloud, Infrastructure & Operations The Agenda The event's dynamic agenda will take you through a series of roundtable discussions, real-life use cases, and dedicated industry tracks, giving you a bird's eye view of the current market situation, the latest technological innovations and strategies for propelling your organization to meet the unique challenges of these unprecedented times. Our Upcoming Events

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