GRI report finds low pCbCR uptake but Fair Tax Foundation can help
As tax transparency continues to rocket, interest in Public Country-by-Country Reporting from businesses and legislators is growing. But multinationals might be unsure of how to take the first steps.
A recent survey from the Global Reporting Initiative (GRI) found that even among those multinationals committed to tax transparency and adopting GRI 207 – the tax standard from the Initiative – the uptake of public Country-by-Country Reporting (pCbCR) was low. Just 28% of the 71 companies they analysed had any form of pCbCR, the lowest of any of the GRI 207 areas for disclosure.
Fair Tax Mark multinational businesses are required to publicly report details about revenue, profit and taxes for each jurisdiction where they operate. And we welcome the recommendation from the GRI that businesses combine GRI 207 with the Fair Tax Mark so that we can help more businesses navigate this area of tax transparency.
We know from speaking with our businesses that constructing a narrative around pCbCR data can present a perceived barrier. But we can help with this – not least by pointing to excellent examples from our businesses, such as Lush, SSE and Ørsted, which have been reporting successfully for years.
As our friends Zorka Milin and Thomas Georges from The Fact Coalition say in the recent GRI report, pCbCR is the “main way for multinational companies to demonstrate their commitment to tax transparency.
“Many stakeholders, from investors seeking to assess material risks to their portfolios, to policymakers, journalists and watchdog groups, have an interest in this information, and dozens of major multinationals are now voluntarily producing these reports.”
Rise in legislation
As well as voluntary reporting, a wave of legislation mandating pCbCR is underway. Progress is being made across the EU’s 27 member states, in Australia with its newly passed law, and in development in EEA countries such as Norway and Liechtenstein.
We shed light on these key changes and provide a clear picture of the current landscape in the latest update to our paper, Public Country-by-Country Reporting: Why and how multinationals should lift the lid on their taxes. This also now includes a handy crib sheet laying out exactly which policymakers are requiring what and where.
The paper details the full set of data we expect multinational businesses to report, on a CbC basis, with an accompanying narrative explanation. We have also prepared a CbC reporting table that can be used. This, if completed fully, would score maximum points in section three of our Global Multinational Business Standard assessment.
The Fair Tax Foundation work with businesses collaboratively on pCbCR and all other elements of the Fair Tax Mark. We offer a supportive space for discussions about making public reporting more meaningful and informative. So, don’t hesitate to get in touch with any questions or apply to become certified.
Recap of resources in this blog:
- Example of a Fair Tax Mark business’s pCbCR
- Legislative updates in our pCbCR paper
- Crib sheet of what policymakers are requiring
- CbC reporting table template
- Fair Tax Foundation’s Global Multinational Business Standard
