How is Financial Capital defined by the International Integrated Reporting Council (IIRC)?

Financial Capital, as defined by the International Integrated Reporting Council (IIRC), refers to the pool of funds available for production and services. This definition encapsulates the notion that financial capital encompasses not just cash but also debt and equity that can be used to fund operations, investments, and other business activities. It represents the financial resources that an organization can leverage to generate value and support sustainable business operations.

This interpretation is crucial within the context of integrated reporting, as it highlights the significance of capital in driving organizational performance and sustainability initiatives. By focusing on financial capital this way, organizations can more effectively communicate how they manage and utilize their financial resources in the context of achieving their overall goals and enhancing stakeholder trust.