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Tax Transparency Benchmark 2019


Publication: Tax Transparency Benchmark 2019

Dutch companies have never been this transparent on their tax strategy. This conclusion follows from the Tax Transparency Benchmark of the Dutch Association of Investors for Sustainable Development (VBDO) at 77 Dutch, stock listed companies. The winner of the fifth Tax Transparency Award is NN Group. With a record score of 30 points from a maximum of 35 points, the company ranks at the top of the benchmark.

“We are proud that after five years, companies have never been as transparent in tax matters as this year. It has become common practice for companies to report on their tax strategy. Huge steps have been taken”, said Angélique Laskewitz, director of VBDO.

Dutch companies score an average of 43% on the six “Good Tax Governance Principles” of VBDO and Oikos. This is considerably higher than the 25% percent first measured in 2015. VBDO calls on investors to include the results of the benchmark in their engagement conversations with Dutch listed companies.

Top 10 score higher than ever
Although all companies together averaged only 43%, the top 10 never scored this high. In general, they report better about risk management, the implementation of the tax strategy and make it more clear whether the business activities correspond to the tax payments in the concerned country.

The jury appointed by VBDO, including Prof. Hans Gribnau, professor at Tilburg University and the University of Leiden, notes that for so many companies this so-called “country-by-country” information does not go beyond government mandated guidelines. Gribnau: “Although companies indicate they do not make use of “tax havens”, this is not always demonstrated. Substantial steps can still be taken here. ”

No audit
Many Dutch companies do not have the processes and implementation of their tax strategy audited. According to VBDO, it is logical that this will happen in the long term, as stakeholders assign increasing importance to validated information. This trend is also visible in sustainability reporting. “The time tax information is merely seen as financial information, is over. This is also evident from the fact that companies publish their tax strategy. It is therefore logical that the internal and external accountants look at this, “says Laskewitz.

NN Group winner “Tax Transparency Award 2019”
NN Group is the winner of the fifth Tax Transparency Award. NN scored 30 points. Second place goes to Wessanen with 28 points and third place is shared by six companies, all scoring 26 points.

The jury praises NN for reporting an extensive tax strategy and risk analysis. The company sets a good example by publishing a country-by-country report of tax payments to governments, number of employees and assets.

Laskewitz: “We would like to congratulate NN Group with their number one position and thank all participating parties for their contributions. What seemed impossible five years ago has now become common practice. Tax transparency is a fact that no company can ignore”.

Finally, VBDO is looking forward to the publication of the new tax reporting standard in December, developed by the standardization organization Global Reporting Initiative (GRI). According to Laskewitz, this standard will greatly promote fiscal transparency worldwide and give stakeholders the opportunity to analyze comparable information.