The Need for Standardization in Enterprise ReportingA Focus on Natural Capital Accounting and XBRL

Liv A. WatsonCo-founder, XBRL standardSr. Director, Workiva, Inc.

Brad J. MonterioVice Chair, XBRL Int’l Best Practices BoardManaging Director, Colcomgroup, Inc.

November 9, 2016

WHAT IS NATURAL CAPITAL?Natural capital is a way of defining the wide range of benefits that we derive from nature. It provides the air we breathe and the water we drink. It is essential to life and it underpins thriving societies and prosperous economies. - Natural Capital Coalition

Natural capital is a critical asset, especially for developing countries where it makes up a significant share (36%) of total wealth. - The World Bank

One of several other commonly recognized forms of capital (e.g., financial, manufactured)

Supports all other capitals by providing essential resources, such as air, water, soil and minerals, supporting a healthy planet that underpins thriving societies, prosperous economies

The stock of renewable and non-renewable natural resources (e.g., plants, animals, air, water, soils, minerals) that combine to yield a flow of benefits to business and society

WHAT IS NATURAL CAPITAL ACCOUNTING?

Natural capital accounting is the process of calculating the total stocks and flows of natural resources and services in a given ecosystem or region. Accounting for such goods may occur in physical or monetary terms.

THE NATURAL CAPITAL ACCOUNTING ECOSYSTEM

PROTOCOLPROTOCOL

ENTITIES

CDSB GRI SASB

“GREEN GDP” “ENVIRONMENTAL PROFIT & LOSS"

UN SEEA

CDP QUESTIONNAIRE

GRI REPORT ANNUAL REPORT

REPORTING FRAMEWORKS & STANDARDS

DISCLOSURE VEHICLE

UK ONS

DEFRA

OTHER AGENCIES

FEDERAL AGENCIES

UN NATIONAL ACCOUNT

QUESTIONNAIRE

DISCLOSURE FORMAT PDF PDF PDFEXCEL

CDP (XBRL) GRI (XBRL) SECURITIES COMMISSIONS

UN NAT’L ACCOUNTS

AGGREGATED DATABASE

DATA REPOSITORIES

DATA CONSUMERS

THE NATURAL CAPITAL COALITION PROTOCOL

INTEGRATING THE NATURAL CAPITAL COALITION PROTOCOL

PUMA AND ITS ENVIRONMENTAL PROFIT & LOSS (EP&L)

Puma quantifies a range of environmental impacts arising from its supply chain, transport networks, operations and manufacturing, focusing especially on the leather and cotton in its products

They measure water use, greenhouse gas emissions, land use and waste Puma believes that by monetizing its impacts it has facilitated better strategic planning and

helped identify those areas of the business where management action is most required

COCA COLA AND NATURAL CAPITAL MATERIAL RISK

Coca Cola has a strong focus on water stewardship - water scarcity is a material risk affecting its business model

Coca Cola commitment expressed through an ambitious target to replenish as much water as it uses by 2020

Achieving this target requires Coca Cola to quantify the water it replenishes, which it has been able to do with support from third party organizations like The Nature Conservancy

DOW CHEMICAL AND ECONOMIC VALUE PROVIDED BY NATURE

Dow Chemical Company analyzing its impacts and dependencies on ecosystems at its joint venture production site in Santa Vitoria, Brazil

This pilot project helped create a roadmap for assessing economic value of the ‘services’ provided to it by nature, which informs decision making at a strategic and operational level

THE STRUCTURED DATA PROJECT

PROTOCOLPROTOCOL

ENTITIES

CDSB GRI SASB

“GREEN GDP” “ENVIRONMENTAL PROFIT & LOSS"

UN SEEA

CDP QUESTIONNAIRE

GRI REPORT ANNUAL REPORT

REPORTING FRAMEWORKS & STANDARDS

DISCLOSURE VEHICLE

UK ONS

DEFRA

OTHER AGENCIES

FEDERAL AGENCIES

UN NATIONAL ACCOUNT

QUESTIONNAIRE

DISCLOSURE FORMAT PDF PDF PDFEXCEL

CDP (XBRL) GRI (XBRL) SECURITIES COMMISSIONS

UN NAT’L ACCOUNTS

AGGREGATED DATABASE

DATA REPOSITORIES

DATA CONSUMERS

ICAEW Natural Capital Accounting Structured Data Task Force

OUR CALL TO ACTION

VOLUNTEER TO REVIEW:• THE PROJECT’S ASSESSMENT OF

INTEGRATING XBRL INTO NATURAL CAPITAL STATISTICAL DATA • THE ALIGNMENT WITH CURRENT

MARKET DEFINITIONS AROUND NATURAL CAPITAL