Integrated reporting, long-term value creation, financial and non-financial objectives... there’s a constant flow of advice, guidance and updates coming at reporters from every direction.
The International Integrated Reporting Council (IIRC), the Dutch Corporate Governance Code, the Financial Reporting Council (FRC), as well as numerous other bodies concerned with sustainability, all continue to launch initiatives around key reporting issues.
For the long-time industry watcher or the dedicated, well-resourced and experienced teams that do such a great job in many of our better companies, all is perhaps crystal clear. But for many others, who juggle annual report responsibilities with their regular day jobs, I sense more than a degree of confusion. What does it all mean? And which bits of advice are the nuggets that really need to be taken on board?
The truth is that while all these different organisations may approach annual reports from different perspectives and have different remits, they’re actually singing the same song – albeit to slightly different tunes.
They have more in common with each other than you might think. It’s clear that the ‘long-term value creation’ promoted by the revised Dutch Corporate Governance Code is driven by the same desire to embrace a broader view of a company’s performance as the IIRC framework, the EU directive on non-financial reporting and the FRC’s focus on values, behaviours and culture.
It’s beyond debate that the various bodies are working really hard to improve the standards and transparency of reporting, for the ultimate benefit of the full range of stakeholders. And at the heart of all the diverse pieces of guidance lies a relatively simple message. Companies should report on long-term non-financial as well as financial performance, in order to meet the needs of all stakeholders – employees, communities, suppliers and others, as well as investors.
As far as the regulators and advisory bodies are concerned, it would be good to have more common ground. Although unlikely, it would be an enormous help to people involved in corporate reporting if all those with influence on best-practice reporting could get together and communicate with a united, harmonious voice. The song’s great – but it's time for everybody to sing it to the same tune.