The concept of CSR in accounting theory and practice in Poland – empirical study

Abstract

Right now the issue of Corporate Social Responsibility (CSR) lies within the scope of interest of various fields of social science and practice, including the science and practice of accounting. Numerous research works stress how accounting, particularly in terms of corporate reporting, is closely connected to the concept of CSR. The idea of CSR is also being reflected in the economic practices of companies. More and more enterprises all over the world are adopting international reporting standards in order to communicate aspects of CSR to their stakeholders. On the Polish market we are also seeing an increase in the annual number of reports that take into account environmental and social issues. The main purpose of this work is to present the concept of CSR in the theory and practice of accounting. The first part of the work was devoted to presentation of the idea of corporate social responsibility in the context of accounting and corporate reporting. The second part contains an overview of the most well-known and comprehensive global standards related to CSR reporting, describes the attempts that have been made to integrate said standards with each other, and indicates the possibilities of combining them with the financial statements. The final part focuses on a two-stage empirical study with regard to CSR reporting on a population of Polish stock exchange companies listed on the Warsaw Stock Exchange Main Market, which are also listed in the WIG-Poland index and the RSPECT Index – the first Polish and one of the few European indexes of socially responsible companies.

Keywords: social accounting, integrated corporate reporting, corporate social responsibility

1. Introduction

It is becoming more and more frequent for business enterprises to take into account social and environmental goals, in addition to their economic goals. In consequence, the historically established area of reporting on performance with regard to economic goals in the form of financial statements is currently being supplemented with information on goals that were achieved and actions that were taken in the sphere of Corporate Social Responsibility (CSR). This information is communicated to respective stakeholder groups and disclosed in various forms (websites, appropriate reports/accounts). The main reason for which the enterprises decide to give an account of their responsibility is pressure from the community, particularly local communities, as well as other pressure groups or ecological movements, which demand the disclosure of information about environmental and social aspects related to a company’s operations. Because oftentimes enterprises are suspected or even blamed for degradation of the environment (inefficient use of natural resources, emission of air and water pollution) and social problems (development of diseases of affluence, unemployment or poverty). Unfortunately, preparation of reports that include aspects of social responsibility is frequently done only for PR purposes, as this type of reporting improves the image of a company. One of the most up-to-date, broad overview of global reporting practices in the sphere of social responsibility published by the KPMG [KPMG, 2011] clearly indicates that in the last 18 years the preparation of reports on CSR has become more commonplace1. Similar conclusions can be drawn in Poland where studies on reporting were conducted in 114 production companies (selected based on the “Pięćsetka Polityki” ranking) in the period between December 2009 and May 2010, as part of the project “Methods and scope of disclosure of social and environmental aspects employed by Polish production companies”2. The purpose of this article is to present the idea of Corporate Social Responsibility (CSR) in the theory and practice of accounting. In order to achieve this purpose, the following study procedure was adopted: 1. review of Polish literature on the subject presenting the connection between the concept of social responsibility, accounting and corporate reporting, 2. conducting an overview of the most well-known, comprehensive global standards related to CSR reporting, describing the attempts that have been made to integrate said standards with each other, and indicating the possibilities of combining them with the financial statements.,

1 In 1993, 12% of the 100 largest companies in the studied 34 countries (largest global companies N100) have prepared a document devoted to accountability for social responsibility; in 2008, this number was 53%, and in 2011 the percentage of companies reporting on CSR issues reached 64%. Meanwhile, in the same period in 250 of the largest companies in the world (selected from among the 500 enterprises included in the ranking Fortune Global 500 List G250) the percentage of reporting companies was virtually zero, whereas in 2011 it was already 95%. The companies that prepare reports most often are those, whose operations have the biggest impact on the environment, i.e. companies from such sectors as the fuel industry, chemical and plastic industry, automotive industry, timber and paper industry and the mining industry. 2 The authors of the analysis conducted in the course of own studies were Aleksandra Paszkiewicz and Arleta Szadziewska [2011]. 34 companies included environmental information and 22 included social information in their annual reports. 30 enterprises prepared sustainable development reports. An overwhelming majority of companies presented CSR data solely on their websites. 3. empirical study, the goal of which was to identify instances of disclosure related to social responsibility in annual reports of Polish public companies listed on the Warsaw Stock Exchange Main Market (WSE). Achievement of specified research goals required the use of adequate research methods, such as: critical analysis of research literature, analysis of global guidelines and standards related to CSR reporting, as well as analysis of CSR data disclosed by studied companies.

2. Corporate social responsibility in the context of accounting

In recent years the research literature has shown an increased interest in the idea (concept) of Corporate Social Responsibility (CSR). It is emphasized that the concept of CSR is very broad with regard to its subject matter. Another thing that is stressed is the interdisciplinary character of the CSR concept, resulting from the fact that it is explained by a number of more detailed and concrete fields of social study and practice, such as business ethics and philosophy, law, ecology, management and accounting. Each of these fields deals with the issues of socially responsible management from a specific perspective and in the context of the problems characteristic for the given research focus [Pogodzińska-Mizdrak 2010, p. 176]. This article looks upon the issues of CSR from the perspective of the science and practice of accounting. The literature research conducted in Poland by G. Bartkowiak [2011, p. 20] concluded that currently there is no simple and universal definition of corporate social responsibility, neither in the literature of respective fields of study, nor in practice. The discrepancies in defining CSR lead to two conclusions. On the one hand, this situation could indicate that the theoretical development of the concept of CSR has been inadequate to date, which should serve as incentive to intensify activities in this area. On the other hand, the variety of CSR definitions may be viewed as a positive thing – as an indication of evolution and expansion of scope of research related to CSR. Corporate social responsibility is an idea of constructing a long-term strategy by an organizational entity that voluntarily takes into account the social, ethical and ecological aspects in its business operations. Such an entity takes responsibility for the decisions that it made and the activities that it undertook, which have an impact on the local community and the environment, and also leads a dialogue with the internal and external stakeholders [Macuda 2013, p. 91]. As such, social responsibility is “a strategic and long-term attitude, based on social dialogue and seeking solutions that are advantageous for everybody involved” [Rok, 2004, p. 18]. As was stated at the Responsible Business Forum [2008, p. 4], corporate social responsibility is “a trend that will not go away like many other business fads, but will develop, evolve, and adapt to the challenges, expectations and possibilities”. The idea of corporate social responsibility is based on a thesis that profitability may be combined with responsibility. To this effect, one needs to redefine the goals of the enterprise and intensify processes aimed at identifying compatibilities between strictly economic activities, the financial bonus of business operations, and the benefits of being socially responsible [Pogodzińska-Mizdrak 2010, p. 176]. E. Burzym [2008, p. 83] concludes that “accounting stimulates ethical behavior, if the numerical image of business operations and their results that it establishes is characterized by clarity, reliability and comparability, and if it constitutes a documented basis for accountability with regard to responsibility for efficient and socially and economically rational use of material and human resources”. A similar opinion is expressed by J. Krasodomska [2010, p. 337] who claimed that the idea of CSR is closely related to the informative function of accounting. She goes on to explain that this relationship may be viewed in two ways. On the one hand, in the context of the quality of information presented in financial statements. On the other hand, in the context of the scope of said information. Therefore, corporate social responsibility may be implemented in the field of accounting by adopting such solutions that will lead to the financial statement being prepared in a socially responsible manner, i.e. so as to present the actual and accurate image of the financial and asset-related situation of a given economic entity. M. Stępień points our attention, apart from the informative function, also to the controlling function of accounting. In her opinion the role of accounting in the execution of corporate social responsibility results from the specific character of this information and control system, which not only provides possibilities for qualitative and quantitative measurement of factors that shape specific components of responsibility, but also constitutes a tool to control its execution, meaning that it makes it possible to ensure the accountability of an enterprise based on a well-designed report [Stępień 2009, p. 355]. Thanks to the possibility of conducting economic measurements and thanks to its informative, controlling and reporting function, accounting is the basis for company accountability with regard to social responsibility3. Accounting, just like any other system, is constantly developing, adapting its solutions to

3 As J. Samelak [2013, p. 23] points out, employing accounting for the purposes of CSR accountability for economic, social and environmental impact of operations began in the second half of the 20th century in countries with well-developed market economies. dynamic changes and the level of complexity of company management processes. As a crucial informative system of a company, it evolves in line with new ideas and challenges related to management tasks and instruments. Corporate social responsibility may be seen as one such idea that requires the adoption of a new set of solutions within the area of accounting. One indication of how the theory and practice of accounting is developing in the direction of compliance with the paradigms of corporate social responsibility is the idea of social accounting4 or social responsibility accounting, in particular its ethical and environmental aspects. Theoretical deliberations in this regard appeared in Poland already in the 1990s thanks to such authors as Jarugowa [1991] and Burzym [1993]. However, as explained by E. Pogodzińska-Mizdrak [2010, p. 179], at the end the 20th century studies on CSR have been sidetracked by other issues, such as the development of internal management accounting, the harmonization and standardization of financial accounting, the specification of a model and quality of financial reports for the purpose of international comparability, or the improvement of financial auditing. Today, in the context of the economic crisis and the stressing of economic, environmental and social interdependence of entities, the study of social accounting is experiencing a revival. Social accounting is a process, in which an enterprise presents its activities in the social, environmental and economic areas. J. Krasodomska [2010, p. 337] writes that the task of external (financial) social accounting is to show how the enterprise integrates with the society and the environment, in which it operates, whereas the task of internal (management) social accounting is to provide information that will help the management to operate in a more socially responsible manner. Social accounting (both external and internal) does not function on its own, it should be integrated with the financial and management accounting systems of a given enterprise. It is a collection of specific components and tasks of management and financial accounting and oscillates between the problems characteristic for both these areas, which fit into the structure of modern accounting. “The success of a corporate social responsibility strategy depends on many factors, one of which is the system of accounting, which includes ready measurement methods, in particular with regard to balance sheet valuation, interpretation and recording of economic events, as well as reporting”

4 In the Polish and global literature of the subject there are numerous related terms such as social accounting [Krasodomska 2011, p. 66]: social and/or environmental disclosure [Degan 2002]; [Jenkins and Yakovleva 2006], sustainability disclosure [Stanwick and Stanwick 2006], corporate social disclosure [O’Dwyer and Owen 2005], social and/or environmental reporting [Gray 2000], corporate social reporting [Hammod and Miles 2004], social reporting [Belal and Owen 2007], sustainability reporting [Kolk 2003], corporate sustainability reporting [Ballou, Hetzer and Landes 2006], social responsibility accounting [Khan, Halabi, Samy 2009], socio-economic accounting [Hassan and Harahap 2010]. [Pogodzińska-Mizdrak 2010, p. 179-180]. Meanwhile, corporate social reporting is defined by J. Krasodomska [2010, p. 338] as the process of informing specific groups of stakeholders and the society as a whole about the social and environmental impact of economic activities of an enterprise in the form of appropriate reports. In Poland we may observe increasingly frequent attempts to prepare reports that also take into account social and environmental issues. One of the reasons for this is the society’s interest in how the operations of specific companies influence the natural environment, as well as the involvement of said companies in social programs and the development of the region, in which they operate. E. Pogodzińska-Mizdrak [2010, p. 182] claims that society demands qualitative reports and analyses, both retrospective as well as prospective, dealing with issues related to CSR. The qualitative factors are difficult to present in a quantitative manner and difficult to combine into a single unified system, which presents an interesting challenge for the world of science to develop suitable measures and methods. Recipients of reports on corporate social responsibility expect them to be created according to simple rules and to have a clear and understandable form, especially since social reporting in Poland is completely optional with regard to the form, place and scope of disclosed information. The form and contents of such reports, according to P. Roszkowska [2011, p. 145-146], are to a large extent dependent on the general communication strategy of a company. If the company operates in complete isolation, the publishing of environmental, social and economic information will be limited to simply presenting the data externally. But if the management wishes to establish lasting relations with the community, the basis for reporting will be the exchange of information and opinions with stakeholders. The published data collected in the course of bilateral communication will be useful for both sides and will affect future activities and directions of company development. P. Roszkowska believes that social responsibility reports fulfill their function if they have the following basic features – coherency, comparability, reliability and usefulness. It is important to be able to compare the operations of a given economic entity with those of another entity or a whole group of entities. As regards report reliability, all reports should be audited and legal sanctions should be available in the case of presenting false information. Finally, reports are useful when information included in them is significant to those, to whom the report is addressed. This idea is shared by J. Krasodomska [2010, p. 338-339], who points out that information created within the system of social accounting, similarly to information generated in regular accounting, should be reliable, complete and delivered to the stakeholders in a timely fashion so as to allow for their use in the decision-making processes. It is important for the information to be significant (should inform about the most crucial aspects of the implemented social responsibility strategy), complete (should take into account all the areas of company’s operations) and comparable in time. Lack of generally binding, unified standards has led to a situation, in which most social responsibility reports cannot be considered coherent, reliable, significant or comparable. Also, increasingly frequently it is postulated that the contents of such reports should be integral, with regard to their subject matter, with financial reports, accurately reflecting the actual situation. The trend is towards a high-quality, comprehensive business reporting. The expectations of the target group of these reports also touch upon the subject of individual responsibility and possible sanctions for each instance of inaccuracy, data manipulation or intentional disinformation. According to M. Stępień [2007, p. 519], one of the key factors limiting the reliability of financial statements is the fact that at present such reports do not deal with certain aspects that are important in the context of social responsibility of a given economic entity. J. Krasodomska [2010, p. 339-340] emphasizes that “providing information about creating value for owners, while simultaneously disclosing information related to protection of the environment, relations with employees or activities undertaken for the benefit of the local community is the basis for evaluating the actual results of a company’s operations. Disclosing information about CSR is non-obligatory and in the absence of external verification it is used only for marketing purposes”. Taking into account the challenges of modern management, the growing popularity of the idea of corporate social responsibility in Poland, and the growing need for companies to take responsibility for the decisions made and the resulting actions, we should intensify the studies in the area of development of social accounting, which can answer the needs for measurement, recording, processing and reporting with regard to corporate social responsibility. J. Samelak [2013] postulates that the contents of CSR reports should be integrated, with regard to their subject matter, with financial reports, which is why he suggests a model of integrated reporting for a socially responsible company. This model will be presented in the second part of this article. Unfortunately, despite the fact that the idea of corporate social responsibility is becoming increasingly popular in Poland, it still functions rather in the sphere of theory than practice.

3. Standards of CSR reporting in the context of financial reporting

Implementation of the idea of corporate social responsibility (CSR) is reflected in the development of corporate reporting. In practice, reporting on CSR issues may take different forms. Since the beginning of the 1970s the form of reports has evolved significantly. At first the reports only dealt with environmental matters. But in time they began covering the three basic thematic areas of a socially responsible enterprise: ESG – environmental, social, governance. Now, the area of reporting is so varied, that in the words of T. Gabrusewicz [2010, p. 58], a report “may be just a few general sentences presenting the organization’s attitude on the issue of social obligations, usually without mentioning the financial value, but it can also be a very detailed description of the entity’s responsibility towards the society”. This problem has also been observed by A. Paszkiewicz and A. Szadziewska [2011, sp. 78] who wrote that some organizations publish social reports, sustainability reports, and sometimes separate environmental reports, while others include information in annual reports or make them available only on their websites. Besides, as stated by E. Eljasiak [2011, p. 101], these reports are not prepared based on international unified standards of measurement and presentation – such as IFRS or US GAAP, which is why they differ not only in their contents, but also quality. The lack of comparability of ESG data and the suitability of said data is to a large extent related to, e.g. the specific character of enterprises from different sectors, which are in turn characterized by different environmental risks. It is also difficult to talk about report comparability since companies use reports for promotional purposes in the field of Public Relations, i.e. they communicate information which are advantageous for the image of the enterprise (e.g. about charity work), but avoid publishing information, which are not altogether positive or convenient (e.g. about negative impact on the natural environment). Another problem is the reliability of these reports because, as noted by A. Kamela-Sowińska [2009, p. 223], verification of CSR reports is not obligatory by law but rather completely voluntary. These issues with report comparability and reliability have led to a global need for, on the one hand, guidelines and norms of reporting on aspects of corporate social responsibility that would unify the reporting activities on a global scale and, on the other hand, standards of ESG report verification that would serve as the basis for auditing and certify a report’s reliability. Right now there are already numerous regulations in place (norms, standards and guidelines) pertaining to preparation and auditing of CSR reports. The most well-known comprehensive regulations related to CSR include: GRI Guidelines, ISO 26000, Global Compact Principles, AA1000AS and ISAE 3000. Global Reporting Initiative (GRI)5 is an international non-profit NGO based on the cooperation of a network of stakeholders, established in 1997 in the US. The GRI prepares unified frameworks for reporting on the issues of sustainable development based mainly on non-financial indicators. Guidelines published by the GRI specify the rules and indicators, which may be used by organizations to measure and report on their economic, environmental and social performance. The GRI strives to ensure constant improvement of its Guidelines, which are freely available, and to ensure a constant increase in the number of their users. The first version of the Guidelines (G1) was published in 2000, the second one (G2) – in 2002. The next version (G3) was made available in 2006 and updated 2011. The latest version of the Guidelines (G4) was published in 2013.A transitional period of two years was introduced between the previously binding G3 Guidelines and the current G4 version. The GRI Guidelines6 make it possible to establish a reporting system and to prepare reports with quantifiable and comparable data. The main feature of the GRI Guidelines is that they are flexible and can be employed by various organizations, regardless of their size, location or the sector that they operate in. According to GRI, reporting on the issue of sustainable development consists in measurement, communication and taking responsibility before stakeholders, both internal and external. This responsibility is related to performance and efficiency in the area of economic, social and environmental issues. Sustainable development reports are prepared for the following purposes:  to serve as benchmarks and a basis for evaluating the organization’s efficiency in addressing the issues of sustainable development,  to present the impact of the organization and show that it is subject to expectations with regard to issues of sustainable development,  to compare the efficiency of a given organization in time in relation to other organizations. The GRI Guidelines not only specify what data to include in the report, but also the rules that a good report should follow. The rules used to specify the contents of the report include:

5 Further comments on the GRI initiative based on materials published on the website: https://www.globalreporting.org/ [date of access: 04.11.2013]. 6 Further deliberations based on the studies of The GRI Sustainability Reporting Guidelines, in particular G3 Guidelines, G3.1 Guidelines and G4 Sustainability Reporting Guidelines. 1. Materiality – presenting aspects and indicators that reflect the material economic and social impact of the organization and its impact on the natural environment, as well as aspects that might have bearing on the evaluation of the entity’s achievements and the decisions made by stakeholders. 2. Stakeholder inclusiveness – defining one’s stakeholders and explaining the method of reacting to their justified needs and interests. 3. Sustainability context – presenting the organization’s performance in a broader context of sustainable development, which requires explaining the organization’s contribution – either in the present or in the future – to the improvement or deterioration of economic, social and environmental conditions, processes and trends on a local, regional and global scale. 4. Completeness – the aspects and indicators considered to be of material importance that are included in the report, as well as the specified scope of the report, should sufficiently reflect the significant economic and social impact as well as the impact on the natural environment of the reporting organization and make it possible for stakeholders to evaluate its performance during the reporting period. The rules used to ensure adequate quality of the reports and proper presentation of information include the following: 1. Balance – The report should reflect positive and negative aspects of the organization’s performance to enable a reasoned assessment of overall performance. 2. Comparability – The organization should select, compile and report information consistently. The reported information should be presented in a manner that enables stakeholders to analyze changes in the organization’s performance over time, and that could support analysis relative to other organizations. 3. Accuracy – the reported information should be sufficiently accurate and detailed for stakeholders to assess the organization’s performance. 4. Timeliness – The organization should report on a regular schedule so that information is available in time for stakeholders to make informed decisions. 5. Clarity – The organization should make information available in a manner that is understandable and accessible to stakeholders using the report. 6. Reliability – The organization should gather, record, compile, analyze and disclose information and processes used in the preparation of a report in a way that they can be subject to examination and that establishes the quality and materiality of the information. Together with determining the contents of the report, a given organization should specify its scope (subjective scope), i.e. entities (e.g. dependent entities), whose performance will be presented in the report. An ESG report should include three different types of information pertaining to:  strategy and profile, i.e. information establishing the general context necessary to understand the organization’s performance, related to such areas as: strategy, organizational profile and governance structure;  management approach, i.e. information related to the manner in which the organization approaches a given set of topics, in order to provide context for better understanding of its performance in a given area;  performance indicators, i.e. indicators that represent comparable information on economic, environmental and social performance of the organization, and with regard to social performance – indicators pertaining to work and employment, human rights, society and product responsibility. The GRI also prepares Sector Supplements (e.g. Oil and Gas, Mining and Metals), which complement the Guidelines with interpretations and provide advice on applying them in a given sector and also include performance indicators characteristic for said sector. Before concluding the works on the report a given organization should declare the application level achieved with regard to the GRI Reporting Framework. In the G3 version three possible application levels were introduced, marked with letters C, B and A. Reporting criteria assigned to each letter reflect the increasing level of application and implementation of the GRI Reporting Framework. Additionally, if the report has been verified by an external, independent certifying entity, the organization may add the mark “+” (plus) to each of the three levels (e.g. C+, B+, A+). In the G4 version the C, B and A application levels were removed, as they’ve been erroneously understood as reflecting the quality of the report itself; instead, a new application criterion was introduced (“in accordance”), which allows for two options: “core” or “comprehensive”, differentiated by the number of specific indicators. GRI reporting may also be combined with other social responsibility initiatives. The GRI Guidelines are compatible with the norm ISO 26000 or with the reporting guidelines “Communication on Progress”, which are required to be followed by all companies joining the Global Compact initiative. ISO 26000 norm, pertaining to social responsibility, was published in 2010 by the International Organization for Standardization. The norm is not subject to certification, but rather serves as a practical manual on the idea of CSR in 7 areas – organizational governance, human rights, labor practices, the environment, fair operating practices, consumer issues and community involvement and development [ISO 26000, 2012]. Solutions presented within are applicable to organizations from the private sector as well as to any organization wishing to operate responsibly. ISO covers the global context of social responsibility, including organization performance reporting to stakeholders and the society as a whole. In 2011, ISO began cooperating with the GRI in terms of reporting. The goal of both organizations is to make it possible to apply the GRI Guidelines on social responsibility of organizations to ISO 26000, and to be able to prepare reports based on GRI Guidelines together with the ISO norm. The result of this cooperation is, e.g. a publication entitled GRI and ISO 26000: How to use the GRI Guidelines in conjunction with ISO 26000. This document includes a table presenting the combination of GRI-G3 Guidelines with the requirements of ISO 26000, specifying in detail how both regulations refer to a similar scope of topics. The other social responsibility initiative that may be combined with GRI reporting is Global Compact Principles (GC)7. The GC initiative, inaugurated in 1999 by Kofi Annan, Secretary General of the United Nations, is a global network of organizations subscribing to cooperation and development according to 10 principles of responsibility in the area of human rights, labor standards, the environment and anti-corruption activities. Business signatories of the GC are obliged to publish annual documents entitled Communication on Progress Report, which are to include three elements: a statement by the CEO about the continued support for the initiative, information on activities undertaken within the areas related to the 10 Principles of GC and a presentation, in measurable form, of the present and expected impact of the company on the environment, in comparison with historical data. The GRI Guidelines provide tools to measure progress and communicate performance with regard to GC Principles. Whereas the universal rules, on which the GC is based, are a central reference point for GRI Guidelines. As such, both initiatives are mutually complementary and constitute a unified platform of values for organizations that wish to implement a sustainable development policy in their operations. As a result, many organizations only publish a single report, which both communicates the progress in the implementation of GC Principles and also includes GRI indicators. Both initiatives work together to aid entities in preparing such joint reports. The result of their collaboration is a guideline published in 2007 entitled Making the connection. The GRI Guidelines and the Global Compact Communication on Progress, as well as the integration of the 10 Global Compact Principles with the latest version of GRI Guidelines (G4).

7 Further comments on the GC initiative based on materials published on the website: http://www.unglobalcompact.org/ [date of access: 04.11.2013]. In order to improve the reliability of the sustainable development report, apart from using internal control systems the GRI Guidelines suggest to employ external entities providing certifying services. Notable examples of globally established standards dealing with reliability of ESG reports include AA1000AS8 and ISAE 30009. Moreover, the GRI Guidelines indicate that reporting on sustainable development may also be combined or integrated with the company’s other reports, including the annual financial statement. This approach stresses the interrelations between financial performance and the economic, environmental and social performance and is reflected in the new concept of reporting, i.e. integrated reporting. At present, the thing that is most important for the development of the concept of integrated reporting is the activity of the International Integrated Reporting Council (IIRC). The goal of the IIRC is to establish a global framework for integrated reporting, which will be applicable all over the world. The IIRC has established close cooperation with the GRI with regard to relations between integrated and sustainable reporting. According to an early draft of the Integrated Reporting Framework, integrating activities may be carried out in various ways in different countries due to differences in legal regulations related to reporting as well as the sectoral diversity and specific organizational culture. Organizations have the option to [Towards 2011]:  combine the social report with the management commentary or the annual report; although this will not be an integrated report, it will be the first logical step to further, in- depth integration of presented content,  publish brief, separate integrated reports together with annual reports required by law or stock exchange regulations; this might be a good solution for companies that do not publish any social reports,  introduce changes to the social reports or – to the extent acceptable under binding regulations – changes to management commentaries, in accordance with the IIRC guidelines,  adopt the concept of integrated reporting for internal purposes, treating it as the basis for preparation of all management communications. In Poland it was J. Samelak [2013, p. 179-181] who first attempted to establish a

8 The AA1000 Assurance Standard is an internationally accepted, freely available standard that provides the requirements for conducting sustainability assurance [AA1000 2008]. 9 The International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other Than Audits or Reviews of Historical Financial Information, was prepared by the International Auditing and Assurance Standards Board (IAASB). conceptual framework for integrated reporting by a socially responsible enterprise. This researcher concluded that it is possible to formulate two concepts of integrating financial and non-financial reporting and that choosing one of these will determine the form of the integrated report, namely:  annual report concept – based on the model of an annual business report, which consists of two parts: financial, covering information included in the financial statement, and non- financial, covering the operational report supplemented with, among other things, aspects of social responsibility and intellectual capital; an integrated report in this form needs to integrate non-financial information into its individual parts, and furthermore integrate financial information with non-financial information, i.e. integrate both parts of the report;  integrated report concept – based on the model of integrated reporting of a socially responsible enterprise, which is currently being developed all over the world; this model assumes that a report is a single, clear, complete and coherent document divided into many parts, which combines non-financial data (including, e.g. operational reports and ESG reports) with financial data found in the financial statement; such an integrated report needs to integrate the content and indicators specified by the GRI with the contents of the operational report (with regard to content that is required by Polish law); additionally, the financial and non-financial parts of this report should include indications (in the form of references) of relations and interrelations between financial and non- financial information. Figure 3.1 and 3.2 shows two model structures of an integrated report for a socially responsible enterprise suggested by J. Samelak.

Figure 3.1. Model of an integrated report based on the annual report concept

Source: [Samelak 2013, p. 179]

In the opinion of Samelak [2013, p. 185] both model structures of an integrated report are universal and may be applied by any organization. However, due to the higher level of integration of presented information in the second model, it would be suitable for stock exchange companies operating in Poland (or possibly non stock exchange companies that are subject to the obligation of financial statement auditing). Whereas the first model is recommended for entities that are obliged to perform financial statement auditing; possibly, it could also be employed by entities that are not subject to auditing.

Figure 3.2. Model of the integrated report concept

Source: [Samelak 2013, s. 182]

4. Study of the CSR disclosures

The purpose of the empirical study described in this article is to identify social responsibility disclosures in annual reports of Polish public companies listed on the Warsaw Stock Exchange Main Market (WSE). The study serves to achieve the third partial goal of the whole work. The empirical study was conducted in two stages. The goal of the first stage was to find answers to two study questions: 1. Do Polish companies listed on the WSE operate in compliance with the CSR criteria? 2. To what extent do Polish companies listed on the WSE prepare separate CSR reports? The first stage covered a population of all Polish companies10 listed on the Warsaw Stock Exchange Main Market as on 31 October 2013. In total, 328 Polish companies listed on the WSE qualified for the study. The subjective scope of the population approved for the first stage of the study is presented in Appendix A. Due to the fact that companies may communicate about CSR in different ways in terms of quality and content, e.g.: by uploading information about CSR only on company websites, we’ve assumed for the purposes of the first stage of the study that publishing information about CSR will mean preparing a CSR report, which in turn will be defined as an ESG report (Environment, Social, Governance), i.e. report on the company’s involvement in these three areas corporate social responsibility: environmental, social and corporate governance. In order to define a document as a separate CSR report, it had to include information about at least two of the three ESG areas. The second stage of the study was a more in-depth and more detailed version of the analysis conducted in the first stage. The goal was to answer the following four related study questions: 1. What forms of disclosure are used with regard to CSR information by companies listed in the RESPECT index11? 2. What is the type and scope of information about CSR disclosed by companies listed in the RESPECT index? 3. What standards or guidelines were used as the basis for preparing CSR reports by companies listed in the RESPECT index? 4. Were the CSR reports prepared by companies listed in the RESPECT index verified by an external auditor? In order to answer the study questions we’ve analyzed all the companies listed in the RESPECT index as on 31 October 2013. A group of 20 companies listed on the WSE qualified for the study – the breakdown of the companies together with their sectoral classification is shown in Table 4.1. (last column). The RESPECT index lists companies that

10 According to the adopted methodology, Polish companies are defined as those listed in the WIG-Poland index (WIG – Warsaw Stock Index). The WIG-Poland index (formerly WIG-PL) is the first state index calculated by the WSE since 22 December 2003. This index only includes the stock of state companies listed on the Main Market of the WSE in Warszawa, which fulfill the basic criteria of participation. 11 The terms “RESPECT Index” and “RESPECT index” shall be used interchangeably throughout the study. are managed in a responsible and sustainable fashion, as well as those that disclose aspects of social responsibility on an appropriate level according to binding criteria. The empirical study was conducted by analyzing the contents of CSR annual reports and separate reports (Management commentary, communications), as well as by analyzing the contents of websites of companies listed in the WIG-Poland and RESPECT indexes. As the authors of this article we are aware of certain limitations of the conducted study. In particular, we are aware of the limited subjective scope, which might lead to some restrictions when extrapolating the results onto all the companies operating in Poland. Moreover, it cannot be excluded that companies not listed on the WSE also prepare CSR reports. This is why any attempt to apply the conclusions from this study to the general population may lead to erroneous results. First stage of study. In response to the first study question it turned out that within the analyzed population only 20 companies operate responsibly in accordance with the RESPECT criteria12. These constitute 6% of all companies listed in the WIG-Poland index. As regards the second study question, out of 328 studied companies only 15 were identified that prepared a separate CSR report (ESG report). This means that 4.6% of companies listed in the WIG-Poland index have prepared a separate CSR report in 2013. Moreover, out of 15 companies that did prepare a separate CSR report, 14 companies were listed in the RESPECT index. The RESPECT Index project13. The second stage of the study dealt with companies listed in the RESPECT index, which is currently the only Polish official and public index of socially responsible companies and at the same time the first pioneer index of this type in Central-Eastern Europe14. The name of the index is derived from the first letters of the following words: Responsibility, Ecology, Sustainability Participation, Environment, Community, Transparency. It emphasizes how the companies listed in the index respect these aspects of social responsibility. The goal of the project is to identify companies that are managed in a responsible and sustainable fashion, and to stress their attractiveness for investors, characterized among other

12 The RESPECT criteria will be described in the second part of this section. 13 Description of the RESPECT index based on the materials published on the WSE website: http://www.odpowiedzialni.WSE.pl/root (date of access: 31.10.2013). 14 In other parts of the world already since the end of the 1990s we’ve seen a significant increase in the number of indexes (benchmarks), the main purpose of which is to illustrate the economic situation among companies that meet specific CSR criteria. These include, for example: Dow Jones Sustainability Index series (DJSI), Calvert Social Index (CSI) – USA; FTSE4GOOD series – England; FTSE Johannesburg Stock Exchange Socially Responsible Index (JSE SRI) – RSA, Sao Paolo Stock Exchange Corporate Sustainability Index (ISE) – Brazil, KLD Global Sustainability Index Series (GSI). things, by: reporting quality, level of investor relations, or corporate governance. What is more, one of the qualifying criteria for the RESPECT Index is the liquidity parameter, which is a concrete reference value for professional investors. The project is executed by WSE in cooperation with external partners. The RESPECT Index project is targeted at companies listed on the WSE, with the exception of the NewConnect market, foreign companies and companies that are simultaneously listed on two different stock exchanges (dual listing). The index is updated in cycles, based on conducted studies analyzing the fulfillment of binding criteria by the companies, which is why at any given point the index lists only those stock exchange companies that operate in accordance with the best standards of management with regard to corporate governance, information governance, investor relations, ecology, social affairs and employee affairs. The periodic studies qualifying a given company to the RESPECT Index consist of three stages, covering the following: 1. identifying the group of companies with the highest liquidity, i.e. companies belonging to the portfolio of the following indexes15: WIG20, mWIG40, sWIG80, 2. evaluating company practices in the field of corporate governance, information governance, investor relations, ecology and social affairs, 3. evaluating the level and complexity of actions undertaken by companies within the framework of broadly-defined social responsibility. This evaluation is based on surveys completed by the companies16 and verification of the results of these surveys by the Project Partner – the Deloitte company. Both the first and the second stage of the study are carried out on the basis of generally available reports published by the companies and the contents of their websites. It is only in

15 The WIG20 index has been calculated since 16 April 1994, based on the stock portfolio of 20 largest companies characterized by the highest liquidity from the Main Market of the WSE. The mWIG40 index is a continuation of the MIDWIG index and has been calculated since 31 December 1997. It covers 40 medium-sized companies listed on the Main Market of the WSE. The sWIG80 index is a continuation of the WIRR index calculated since 31 December 1994 and at present includes 80 small companies listed on the Main Market of the WSE. 16 The survey RESPECT Index 2013– edition VII; includes 48 single-choice or multiple-choice questions divided into three areas: Environmental (environmental factors), Social (social factors) and Governance (economic factors). Questions from the Environmental area deal with such aspects as environmental management (3 questions), environmental impact limitation (7 questions), biodiversity (1 question), and environmental aspects of products/services (3 questions). Questions from the Social area touch upon such topics as: OHS (4 questions), HR management (8 questions), relations with suppliers (5 questions), dialogue with interested parties (1 question), and social reporting (2 questions). Governance questions refer to the following: strategic management (2 questions), code of conduct (1 question), risk management (1 question), abuse risk management (1 question), internal audit and control system (2 questions), and relations with customers (9 questions). the third stage that the involvement of the company is required (direct visits of auditors in company headquarters, consent to participation in the project). Determining the companies’ maturity, confirmed by positively passing all three stages of study, makes it possible to specify the final composition of the RESPECT index. Of particular importance when it comes to determining a company’s maturity in the field of CSR communications are the evaluation criteria specified for stage two and three. During the second stage the following criteria are taken into account:  being hit with sanctions by the Polish Financial Supervision Authority (PFSA) and/or Warsaw Stock Exchange (WSE) and/or Polish Association of Listed Companies (SEG) with regard to fulfillment of information obligations within the period of the previous six months – if any penalties were charged, the company is disqualified from further studies,  requirement of impeccable reporting in the field of corporate governance and the quality of current reports, instances of introducing corrections to previously published reports, the number of such corrections and their importance within the period of the previous six months.  maintaining a website in accordance with the standard introduced by the WSE – evaluation of company websites in terms of quality of communication with investors (publishing basic corporate documents on the website, as well as annual and periodic reports), the speed of such communication (responses to queries) and its efficiency (effective functioning of the website’s content search tool, inclusion of links to websites of other institutions, e.g. PFSA, WSE, availability of the website in English). The criteria used in the third stage (survey) can be divided into the following categories:  strategy and management – which include: business strategy; policy and management in the field of social responsibility (CSR); CSR reporting; ethical attitude; risk management; internal audit and internal control; communication with interested parties,  environment – including: environmental management systems; reduction of use of resources, water, power and fuels; waste management; actions limiting biodiversity; any penalties received with regard to the aforementioned areas,  relations with employees – meaning: safe work conditions; work-related incidents; sick absenteeism; HR policy; employee evaluations; employee attitude studies; additional services rendered to the benefit of employees; any penalties received with regard to the aforementioned areas, Table 4.1. Breakdown of companies listed in the RESPECT Index from its introduction to the date of conducting the study with classification into economy sectors Company name / Date of update Sector 09-11-27* 11-01-31 11-04-05 11-07-31 12-01-31 12-04-20 12-07-31 12-12-28 13-01-31 13-07-31 13-10-31 Bank BPH S.A. banking Bank Handlowy w Warszawie S.A. banking Bank Millennium S.A. banking Bank Zachodni WBK S.A. banking BRE Bank S.A. banking ING Bank Śląski S.A. banking Kredyt Bank S.A. banking BUDIMEX S.A. construction ELEKTROBUDOWA S.A. construction PGE Polska Grupa Energetyczna S.A. power industry Zespół Elektrociepłowni Wrocławskich power industry PELIONKOGENERACJA S.A. S.A. wholesale trade Apator S.A. industry Barlinek S.A. industry CIECH S.A. industry Fabryka Farb i Lakierów ŚNIEŻKA S.A. industry Grupa LOTOS S.A. industry Grupa Żywiec S.A. industry Jastrzębska Spółka Węglowa S.A. industry KGHM Polska Miedź S.A. industry Lubelski Węgiel BOGDANKA S.A. industry Mondi Świecie S.A. industry PBG S.A. industry Polski koncern Naftowy ORLEN S.A. industry Polskie Górnictwo Naftowe i Gazownictwo S.A. industry Zakłady Azotowe w Tarnowie-Mościcach S.A. industry Zakłady Magnezytowe ROPCZYCE S.A. industry Dom Maklerski IDM SĄ capital market NETIA S.A. telecommunications Telekomunikacja Polska S.A. telecommunications Powszechny Zakład Ubezpieczeń S.A. insurance Number of companies in the index 16 21 16 22 26 23 22 20 20 20 20 * date format: YY-MM-DD. Source: based on information available on the WSE website: http://www.gpw.pl (date of access: 31.10.2013).  relations with suppliers and customers – which include: timely fulfillment of obligations; policy of processing warranty claims, charges and complaints; advertising/marketing ethics; protection of personal information; solutions supporting the disabled; any penalties received with regard to the aforementioned areas. Since the introduction of the Respect Index to the day of conducting the study 31 companies from different sectors of the economy were listed in the index17. These are shown in Table 4.1. The highest number of companies listed in the Respect Index at a given time was 26, and the lowest – 16.

telecommunications; insurance; 1 2; 6% 3% capital market; 1; 3% wholesale trade; 1; 3%

power industry; 2; industry; 15; 7% 48%

construction; 2; 7%

banking; 7; 23%

Figure 4.1. Companies comprising the Respect Index in the period between 27.11.2009 and 31.10.2013 with breakdown into sectors

Source: based on Table 4.1.

Additionally, Table 4.1. illustrates the low diversity of the sectoral distribution of companies listed in the RESPECT index. The analysis of this structure reveals that the dominant companies belong to the industry sector (15 companies) and the banking sector (7 companies), and the remaining 6 sectors are represented by only 9 companies in total. Therefore, the first two sectors cover 71% of the companies listed in the index. The number of companies from each sector together with their percentage share is shown in Figure 4.1. CSR disclosure in the practices of Polish companies listed in the RESPECT Index. The second stage of the study included all the entities listed in the Respect Index as on 31 October 2013. These are shown in Table 4.1. (last column). In the following sections we’ve answered the specified study questions.

17 Sectoral classification is consistent with the methodology adopted by WSE, which assumes a division of the economy into 27 sectors. In Table 4.1. we can see that as on 31 October 2013 the Respect Index included 20 companies. The analysis of the sectoral structure of these companies shows low diversity. The dominant companies belong to the industry sector (8 companies) and the banking sector (4 companies), and the remaining 5 sectors are represented by a total of 8 companies. So, the first two sectors cover 60% of all the companies listed in the index, as shown in Figure 4.2.

insurance; 1; 5% telecommunications; 2; 10%

wholesale trade; 1; 5% industry; 8; 40%

power industry; 2; 10%

construction; 2; 10% banking; 4; 20% Figure 4.2. Companies comprising the Respect Index as on 31.10.2013 with breakdown into sectors

Source: based on Table 4.1.

In the course of further studies we’ve used the method of analyzing the data revealed by individual companies included in the RESPECT Index related to their socially responsible activities, which made it possible to answer the specified study questions. In response to the first study question – what forms of communication are used with regard to CSR information by companies listed in the RESPECT index – on the basis of Table 4.2. it was determined that out of all the companies listed in the RESPECT Index as on 31 October 2013:  13 companies prepare a separate CSR report (R),  1 company prepares an environmental report, dealing solely with issues belonging to the Enviroment area,  7 companies publish information about CSR in the Management commentary (MC),  20 companies publish brief information about CSR on their websites,  1 company publishes communications about CSR only on its website,  1 company is in the process of implementing a CSR strategy. One notable entity is the Grupa Lotos S.A., which prepared an integrated report (IR) combining communication about CSR in the three ESG areas with the annual financial statement. The companies that disclose information about CSR in the form of separate CSR reports or in the Management commentary qualified for the next stage of the study. In our opinion only these forms of disclosure may be considered to be of adequate quality. Consequently, two companies that publish information about CSR on their websites and one company that is in the process of implementing a CSR strategy have been excluded from further studies.

Table 4.2. Forms of communication used with regard to CSR by companies listed in the RESPECT index Communication about CSR in Communication about CSR in the form of a section of the Other Company name / the form of a separate report annual report communication Date no. of Name of the annual no. of forms CSR report name pages report section pages Information Corporate social Apator S.A. 63 published on the responsibility report website Information Social responsibility Bank BPH S.A. 85 published on the report website Board report on business activities – Information Bank Handlowy w Chapters entitled 3 published on the Warszawie S.A. “Cultural patronage and website social involvement” Information Bank Millennium Responsible business 100 published on the S.A. website Social responsibility BUDIMEX S.A. 64 Ethics code report ELEKTROBUDOWA Responsible business 22 Ethics code S.A. report

In combination with the Information financial statement as an Grupa LOTOS S.A. 483 published on the Integrated annual report website – in electronic form Corporate social Information responsibility report ING Bank Śląski S.A. published on the entitled “The art of website responsibility” Information published on the Jastrzębska Spółka website entitled Węglowa S.A. “Responsible business” Board report on business activities – Information KGHM Polska Miedź Corporate social chapter entitled 3 published on the S.A. responsibility report “Corporate social website responsibility” Board report on business activities – section entitled “Adoption of CSR Ethics code; Lubelski Węgiel strategy for the years Information 15 BOGDANKA S.A. 2012-2015” – the published on the company only began website implementing the CSR strategy on March 1st, 2012 Information Sustainable NETIA S.A. 46 published on the development report website Information PELION S.A. published on the website Environmental Board report on report dealing business activities – solely with chapter entitled PGE Polska Grupa ecological issues “Involvement” and 61 Energetyczna S.A. (20 pages); “Statement of following Information the rules of corporate published on the governance” website Polski koncern Information Responsible business Naftowy ORLEN 88 published on the report S.A. website Polskie Górnictwo Information Naftowe i Responsible energy 62 published on the Gazownictwo S.A. website Board report on business activities – Information Powszechny Zakład Corporate social chapters entitled 61 20 published on the Ubezpieczeń S.A. responsibility report “Corporate social website responsibility” and “Corporate governance” Ethics code, Telekomunikacja Social responsibility Information 136 Polska S.A. report published on the website Board report on business activities – chapter entitled Zakłady Azotowe w Environmental report “Responsibility for Tarnowie-Mościcach (dealing solely with the 4 Ethics code, future generations. On S.A. environment) the road towards sustainable development” Zespół Board report on Elektrociepłowni business activities – Information Wrocławskich chapter entitled 4 published on the KOGENERACJA “Sustainable website S.A. development and social responsibility” Source: Based on CSR disclosure by companies listed in the RESPECT Index

In response to the second study question – what is the type and scope of information about CSR disclosed by companies listed in the RESPECT index – on the basis of Table 4.3. it was determined that out of the 17 analyzed companies RESPECT Index companies:  15 companies (88%) disclosed information from the Environment area (E),  15 companies (88%) disclosed information from the Social area pertaining to the employees (S),  16 companies (94%) disclosed information from the Social area pertaining to the society (S),  13 companies (76%) disclosed information from the Governance area (G). Additionally, as regards additional information it is worth noting the disclosure referring to: ethics – 7 companies (41%) and communication with interested parties – 9 companies (53%). A breakdown of forms (R, MC, IR) and types of disclosure (E, S, G) about CSR by RESPECT Index companies is shown in diagram 4.1.

Diagram 4.1. Forms and types of CSR disclosure by companies listed in the RESPECT Index

IR 1

R 1 12

MC 2 2

E, ES, ESG ESG S, EG, + G. SG. F Source: Based on CSR disclosure by companies listed in the RESPECT Index Table 4.3. Type and scope of information about CSR occurring in CSR reports prepared by companies listed in the RESPECT Index

Information Corporate Information Form of Ecology Employees Society Communication Other aspects Company name about the Ethics governance about disclosure* '(E) (S) (S) with stakeholders (e.g. financial) report (G) indexes Apator S.A. R x x x x x x x x Bank BPH S.A. R x x x x x Bank Handlowy w Warszawie S.A. MC x x x Bank Millennium S.A. R x x x x x x x BUDIMEX S.A. R x x x x x x x x ELEKTROBUDOWA S.A. R x x x x x x Grupa LOTOS S.A. IR x x x x x x x x ING Bank Śląski S.A. R x x x x x x x x KGHM Polska Miedź S.A. R x x x x x x NETIA S.A. R x x x PGE Polska Grupa Energetyczna S.A. MC x x x x Polski koncern Naftowy ORLEN S.A. R x x x x x x Polskie Górnictwo Naftowe i Gazownictwo S.A. R x x x x x x x Powszechny Zakład Ubezpieczeń S.A. R x x x x x x x x Telekomunikacja Polska S.A. R x x x x x x x Zakłady Azotowe w Tarnowie-Mościcach S.A. R x x x x x Zespół Elektrociepłowni Wrocławskich MC x x x KOGENERACJA S.A. * R – separate CSR report, MC – Management commentary, IR – integrated report Source: based on CSR reports prepared by companies listed in the RESPECT index

In response to the third study question – what standards or guidelines were used as the basis for preparing CSR reports by companies listed in the RESPECT index – on the basis of Table 4.4. it was determined that out of the 17 analyzed RESPECT Index companies:  12 companies (71%) followed the GRI Guidelines,  4 companies (24%) followed the Global Compact Principles,  1 company (6%) followed the guidelines of ISO 26000,  4 companies (24%) followed their own regulations  2 companies (12%) followed both the GRI Guidelines as well as the Global Compact Principles,  1 company (6%) followed three types of standards and guidelines (GRI, Global Compact and ISO 26000).

Table 4.4. Standards or guidelines employed as the basis for preparation of CSR reports by companies listed in the RESPECT index Standards or guidelines serving as the basis for preparation of CSR reports Other basis for Company name Global Compact GRI Guidelines* ISO 26000 report preparation, Principles e.g. own regulations Apator S.A. B Bank BPH S.A. B

Bank Handlowy w Warszawie S.A. own regulations Bank Millennium S.A. B BUDIMEX S.A. B+ ELEKTROBUDOWA S.A. x Grupa LOTOS S.A. A+ x ING Bank Śląski S.A. B KGHM Polska Miedź S.A. B NETIA S.A. x** PGE Polska Grupa Energetyczna S.A. own regulations Polski koncern Naftowy ORLEN S.A. B x Polskie Górnictwo Naftowe i C x x Gazownictwo S.A. Powszechny Zakład Ubezpieczeń S.A. C Telekomunikacja Polska S.A. B+ Zakłady Azotowe w Tarnowie- own regulations Mościcach S.A. Zespół Elektrociepłowni Wrocławskich own regulations KOGENERACJA S.A. * Respective implementation levels were marked by GRI with the letters C (lowest level), through C+, B, B+, and A to A+ (where “+” means internal verification of the report). ** The company follows GRI Guidelines, but did not disclose the level of implementation. Source: Based on CSR disclosure by companies listed in the RESPECT Index

In response to the fourth study question – were the CSR reports prepared by companies listed in the RESPECT index verified by an external auditor – it was determined that out of the 17 analyzed RESPECT Index companies:  3 companies subjected their CSR reports to independent, external verification documented by issuing a verification report in the form of a certificate of the auditing company (the mark “+” in the column related to GRI Guidelines means that the report has been verified),  14 companies did not subject their communications to verification by an external auditor.

5. Conclusions

The deliberations of this article, which contribute to the ongoing discussion of fundamental importance for the development of accounting, including in particular corporate financial reporting in the global context, have made it possible to formulate the following conclusions and recommendations:  The term CSR is defined inconsistently in the research literature. Nevertheless, a common aspect of all definitions is understanding CSR as the responsibility of a company, operating in an ethical and transparent manner, for the impact that its decisions and actions have on the society (including stakeholders) and the environment,  The concept of CSR remains closely related with accounting, in particular with corporate reporting. This is due to the historically established role of accounting, i.e. providing a material representation of the relations of responsibility between interested parties (controlling and informative function) in the form of financial statements, which are currently being supplemented with new information from the sphere of CSR. This situation has led to the expansion of the objective scope of accounting and the creation of a new branch – social accounting. This is an indication of the evolutionary development of accounting.  An overview of Polish research literature reveals that research achievements in the field of social accounting are not significant. This is due to the fact that by now researchers have been focusing on other issues, such as harmonization and standardization of financial accounting or specification of a model and quality of financial reports for the purpose of international comparability. Presently however, we can observe a revival of research works dealing with CSR.  It has been indicated that in order to fulfill the goals of social accounting it is necessary to establish, within its framework, a suitable basis for execution of social responsibility through the development of, e.g.: o financial reporting, which according to the idea of true and fair view presentation (TFV) would communicate to stakeholders the results of company operations in a clear, honest, comparable and reliable manner (including by expanding the scope of disclosure in periodic financial statements, or by striving towards the creation of a single global set of financial reporting standards), o effective ways of social control over company operations, exercised by authorized independent auditors, o ethical tools employed to limit the occurrence of phenomena, which are pathological or at odds with the rules of social interaction.  It has been determined that currently the best method of social reporting, in terms of both quality and subject matter, is when the contents of CSR reports are integrated with the contents of financial reports, taking the form of a integrated report.  Problems with CSR report comparability and reliability have led to a global need for, on the one hand, guidelines and norms of reporting on aspects of corporate social responsibility that would unify the reporting activities on a global scale and, on the other hand, standards of ESG report verification that would serve as the basis for auditing and certify a report’s reliability.  It has been concluded that the GRI Guidelines constitute the most comprehensive set of guidelines related to CSR reporting. Furthermore, reporting according to GRI Guidelines can be combined with other social responsibility initiatives, such as: the ISO 26000 norm or the reporting guidelines “Communication on Progress”, which are required to be followed by all companies joining the Global Compact initiative. Moreover, reporting on sustainable development according to the GRI Guidelines may also be combined or integrated with the company’s other reports, including the annual financial statement.  It has been determined that integrating CSR reporting with an entity’s other reporting activities, including the preparation of an annual financial statements, may be carried out in various ways in different countries due to differences in legal regulations related to reporting as well as differences in organizational culture.  It has been shown that within the Polish legal system there is a possibility to integrate the CSR report with the annual financial statement. Such integration, according to the conceptual framework developed in Poland by J. Samelak, may be based on the annual report concept, in which the operational report is the key part of the integrated report, or on the integrated report concept, in which a single document integrates all non-financial information (including the CSR report) with financial information by indicating relations and interrelations between said information types.  It has also been determined that among Polish public companies listed on the WSE, which are also listed in the WIG-Poland index only 6% operate in a socially responsible manner according to the RESPECT criteria, and less than 4.6% of all companies listed in the WIG- Poland and 70% of RESPECT index companies prepare separate CSR reports. Out of all the companies that prepare separate CSR reports 93% prepare ESG reports, i.e. such that cove the basic required aspects of corporate social responsibility, and only 7% prepare ES, EG or SG reports. It should also be noted that 41% of companies preparing separate CSR reports included the ethical aspects of their operations in these reports. Another important conclusion of the empirical study is that out of all the companies preparing separate CSR reports, 70% followed the GRI Guidelines with some differences in application levels, including 66% companies with a “B” application level. The study also revealed that the percentage share of companies, whose CSR reports were verified by an independent external auditor, is not very high, being only 18%. One specifically crucial result of the study was determining that among the companies that prepared separate CSR reports and are listed in the RESPECT Index, only one prepared an integrated annual report for the year 2012.

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Appendix A Lp. Pełna nazwa Spółki Lp. Pełna nazwa Spółki (c.d.) 1 Narodowy Fundusz Inwestycyjny Octava SA 57 Celtic Property Developments SA 2 4Fun Media SA 58 Ceramika Nowa Gala SA 3 AB SA 59 Chemoservis-Dwory SA 4 ABC Data SA 60 CI Games SA 5 AC SA 61 Ciech SA 6 Action SA 62 Clean&Carbon Energy SA 7 AGORA SA 63 Centrum Nowoczesnych Technologii SA 8 Alchemia SA 64 Cognor SA 9 Alior Bank SA 65 Colian SA 10 Alma Market SA 66 Comarch SA 11 Alta SA 67 Comp SA 12 Ambra SA 68 Cyfrowy Polsat SA 13 AMICA Wronki SA 69 Firma Oponiarska DĘBICA SA 14 AmRest Holdings SE 70 Decora SA 15 Apator SA 71 Delko SA 16 Aplisens SA 72 Dom Maklerski WDM SA 17 Arctic Paper SA 73 Dom Development SA 18 Arcus SA 74 Drop SA 19 Armatura Kraków SA 75 Drozapol-Profil SA 20 Arteria SA 76 Polski Koncern Mięsny Duda SA 21 Asseco Business Solutions SA 77 e-Kancelaria Grupa Prawno-Finansowa SA 22 Asseco Poland SA 78 Echo Investment SA 23 Asseco South Eastern Europe SA 79 ED Invest SA 24 Atende SA 80 Eko Export SA 25 Atlanta Poland SA 81 Elektrobudowa SA 26 ATLANTIS SA 82 Elektrotim SA 27 ATM Grupa SA 83 Zakłady Urządzeń Komputerowych ELZAB SA 28 ATM SA 84 EMC Instytut Medyczny SA 29 Atrem SA 85 Emperia Holding SA 30 AWBUD SA 86 Narodowy Fundusz Inwestycyjny Empik Media & Fashion SA 31 Bakalland SA 87 Enea SA 32 Przedsiębiorstwo Handlu Zagranicznego Baltona SA 88 Centrum Medyczne ENEL-MED SA 33 Bank Millennium SA 89 ENERGOAPARATURA SA 34 Barlinek SA 90 Energoinstal SA 35 BBI Development SA 91 Erbud SA 36 Benefit Systems SA 92 Ergis-Eurofilms SA 37 Berling SA 93 ES-System SA 38 Bioton SA 94 Eurocash SA 39 Bipromet SA 95 Europejskie Centrum Odszkodowań SA 40 Black Lion Fund SA 96 Eurotel SA 41 Lubelski Węgiel Bogdanka SA 97 FAM Grupa Kapitałowa SA 42 Boryszew SA 98 Famur SA 43 Bank Ochrony Środowiska SA 99 Farmacol SA 44 Bowim SA 100 Fabryka Sprzętu i Narzędzi Górniczych FASING SA 45 Bank BPH SA 101 Fast Finance SA 46 BRE Bank SA 102 Feerum SA 47 BSC Drukarnia Opakowań SA 103 Ferro SA 48 BUDIMEX SA 104 Ferrum SA 49 Bumech SA 105 Fon SA 50 Zakłady Odzieżowe BYTOM SA 106 Fabryki Mebli FORTE SA 51 Bank Zachodni WBK SA 107 Fota SA 52 Calatrava Capital SA 108 Gant Development SA 53 CAM Media SA 109 Getin Holding SA 54 Capital Partners SA 110 Getin Noble Bank SA (d. Get Bank SA) 55 CCC SA 111 Gino Rossi SA 56 CD Projekt SA 112 Global Cosmed SA Lp. Pełna nazwa Spółki (c.d.) Lp. Pełna nazwa Spółki (c.d.) 113 Giełda Papierów Wartościowych w Warszawie SA 165 Konsorcjum Stali SA 114 Graal SA 166 KOPEX SA 115 Pfleiderer Grajewo SA 167 Korporacja Budowlana DOM SA 116 Inter Groclin Auto SA 168 Koszalińskie Przedsiębiorstwo Przemysłu Drzewnego SA 117 Grupa Azoty SA 169 Krakchemia SA 118 Zakłady Chemiczne Police SA 170 Kredyt Inkaso SA 119 Grupa DUON SA 171 Krezus SA 120 Grupa Lotos SA 172 Kruk SA 121 Grupa Nokaut SA 173 Zakłady Tłuszczowe KRUSZWICA SA 122 Globe Trade Centre SA 174 Krynicki Recykling SA 123 Bank Handlowy w Warszawie SA 175 LC Corp SA 124 Harper Hygienics SA 176 Lena Lighting SA 125 Hawe SA 177 Zakłady Lentex SA 126 Helio SA 178 Libet SA 127 Herkules SA 179 LPP SA 128 HUTMEN SA 180 LST CAPITAL SA 129 Przedsiębiorstwo Hydrauliki Siłowej HYDROTOR 181 LUBAWA SA SA 130 Hygienika SA 182 Mabion SA 131 Hyperion SA 183 Macrologic SA 132 IDEA Towarzystwo Funduszy Inwestycyjnych SA 184 Magellan SA 133 Ideon SA 185 Magna Polonia SA 134 Dom Maklerski IDM SA 186 Makarony Polskie SA 135 IMPEL SA 187 Makrum SA 136 Impera Capital SA 188 MCI Management SA 137 Impexmetal SA 189 Mennica Polska SA 138 Indykpol SA 190 Mercor SA 139 Infovide-Matrix SA 191 Midas SA 140 ING Bank Śląski SA 192 Zakłady Przemysłu Cukierniczego MIESZKO SA 141 Inpro SA 193 Mirbud SA 142 INSTAL KRAKÓW SA 194 Mispol SA 143 Integer.pl SA 195 MIT Mobile Internet Technology SA 144 Inter Cars SA 196 MNI SA 145 Interbud-Lublin SA 197 Mo-Bruk SA 146 Interferie SA 198 Monnari Trade SA 147 Intersport Polska SA 199 Mostostal-Export SA 148 Introl SA 200 MOSTOSTAL Płock SA 149 INVESTcon GROUP SA 201 Mostostal Warszawa SA 150 Invista SA 202 Mostostal Zabrze - Holding SA 151 Ipopema Securities SA 203 M.W. Trade SA 152 IQ Partners SA 204 Netia SA 153 Izostal SA 205 Netmedia SA 154 Jastrzębska Spółka Węglowa SA 206 Neuca SA 155 JHM DEVELOPMENT SA 207 NOVITA SA 156 Jupiter SA 208 NTT System SA 157 J.W. Construction Holding SA 209 Odlewnie Polskie SA 158 K2 Internet SA 210 Open Finance SA 159 Grupa KĘTY SA 211 Oponeo.pl SA 160 KGHM Polska Miedź SA 212 OPTeam SA 161 Kino Polska TV SA 213 Orbis SA 162 Kofola SA 214 Orzeł Biały SA 163 Zespół Elektrociepłowni Wrocławskich 215 OT Logistics SA KOGENERACJA SA 164 Komputronik SA 216 Zakłady Przemysłu Cukierniczego Otmuchów SA

Lp. Pełna nazwa Spółki (c.d.) Lp. Pełna nazwa Spółki (c.d.) 217 P.A. Nova SA 267 Relpol SA 218 PAGED SA 268 Przedsiębiorstwo Modernizacji Urządzeń Energetycznych REMAK SA 219 Zespół Elektrowni Pątnów-Adamów-Konin SA 269 Robyg SA 220 Pamapol SA 270 Zakłady Magnezytowe ROPCZYCE SA 221 Pani Teresa Medica SA 271 Rovese SA 222 Patentus SA 272 SCO-PAK SA 223 PBS Finanse SA 273 Seco/Warwick SA 224 PC Guard SA 274 Seko SA 225 PCC Exol SA 275 Selena FM SA 226 PCC Intermodal SA 276 Sfinks Polska SA 227 PEKAES SA 277 SIMPLE SA 228 Bank Polska Kasa Opieki SA 278 SKOTAN SA 229 Pelion SA 279 Skystone Capital SA 230 Przedsiębiorstwo Przemysłu Spożywczego PEPEES SA 280 SMT SA 231 Petrolinvest SA 281 Fabryka Farb i Lakierów ŚNIEŻKA SA 232 PGE Polska Grupa Energetyczna SA 282 SOLAR Company SA 233 Polskie Górnictwo Naftowe i Gazownictwo SA 283 Sonel SA 234 Polski Koncern Naftowy ORLEN SA 284 Stalexport Autostrady SA 235 Powszechna Kasa Oszczędności Bank Polski SA 285 Stalprodukt SA 236 Przetwórstwo Tworzyw Sztucznych Plast-Box SA 286 STALPROFIL SA 237 Platinum Properties Group SA 287 Zakłady Urządzeń Kotłowych Stąporków SA 238 Platforma Mediowa Point Group SA 288 Sanockie Zakłady Przemysłu Gumowego STOMIL SANOK SA 239 Przedsiębiorstwo Robót Inżynieryjnych POL-AQUA SA 289 Suwary SA 240 Polimex-Mostostal SA 290 Swissmed Centrum Zdrowia SA 241 Polish Energy Partners SA 291 Sygnity SA 242 Zakłady Automatyki POLNA SA 292 Synthos SA 243 Polnord SA 293 Talex SA 244 Polska Grupa Odlewnicza SA 294 Tarczyński SA 245 Polski Holding Nieruchomości SA 295 Tauron Polska Energia SA 246 Pozbud T&R SA 296 TelForceOne SA 247 Pragma Faktoring SA 297 Tell SA 248 Pragma Inkaso SA 298 Tesgas SA 249 P.R.E.S.C.O. Group SA 299 TIM SA 250 Prochem SA 300 Toya SA 251 Próchnik SA 301 TELEKOMUNIKACJA POLSKA SA 252 PROJPRZEM SA 302 Trakcja SA 253 Protektor SA 303 Trans Polonia SA 254 Powszechne Towarzystwo Inwestycyjne SA 304 Triton Development SA 255 Zakłady Azotowe Puławy SA 305 TVN SA 256 PZ Cormay SA 306 ULMA Construccion Polska SA 257 Powszechny Zakład Ubezpieczeń SA 307 Unibep SA 258 Quercus Towarzystwo Funduszy Inwestycyjnych SA 308 Ursus SA 259 Qumak SA 309 Vantage Development SA 260 Radpol SA 310 Giełda Praw Majątkowych Vindexus SA 261 RAFAKO SA 311 Vistula Group SA 262 Fabryka Obrabiarek RAFAMET SA 312 Votum SA 263 Rainbow Tours SA 313 Voxel SA 264 Rank Progress SA 314 W Investments SA 265 Rawlplug SA 315 Przedsiębiorstwo Produkcyjno Handlowe Wadex SA 266 Redan SA 316 Wasko SA Lp. Pełna nazwa Spółki (c.d.) 317 WAWEL SA 318 Wielton SA 319 Wikana SA 320 Wojas SA 321 Work Service SA 322 Yawal SA 323 Zakłady Mięsne Henryk Kania SA 324 Zamet Industry SA 325 ZASTAL SA 326 Zetkama SA 327 ZPUE SA 328 ZUE SA