Unlocking hidden value from reporting

Unlocking hidden value from reporting

Last week, alongside colleagues from SalterBaxter, we discussed the merits of annual reporting at the Evolution of the Annual Report Conference, organised by Communicate Magazine.

Delegates hailed from a range of sectors, including luxury, retail, manufacturing as well as industry bodies and regulators. There was talk of the constantly evolving and ever increasing reporting regulations. However, the overarching theme of the event was the huge cultural shift in businesses’ approach to reporting.

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There were some good examples of reports shared during the afternoon, but we know there are still too many businesses failing to unlock value in their annual report. PWC’s Annual Review of Corporate Reporting in [2018] found that 69% of digital reports are downloadable, clunky pdf’s housed on the corporate website. They are hard to use, difficult to access from mobile devices and are often difficult to navigate.

Before we outline our stance on reporting, it is important to consider the objective of an annual report. A good annual report boosts reputation by shining a light on positive business stories. This is especially important in times of a brand crisis. Organisations who have built up reputational capital have greater resilience and will be in a stronger position when a crisis hits.

We see annual reports as an ecosystem that sets the foundations for wider engagement. This is something we call ‘Campaignable Reporting.’ Reports of the future will move from static bound documents, to interactive and engaging digital reports. They will shift from passive to active reputational management.

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Increased global concerns about climate change and the environment mean that businesses must be clear about their sustainability strategies. Companies who are leading the way, should see their annual report as an opportunity to showcase what they’re doing.

Coca Cola and Burberry discussed their approach to reporting during the conference and reinforced this changing landscape. Both businesses have overhauled their reporting in recent years and provided insight into some of the challenges they have faced along the way.

Increased consumer activism and the rise of digital mean that businesses can no longer hide difficult issues.  Failing to be transparent on risk and risk mitigation can foster the belief that you are not prepared. This can erode business value.   

Customers, stakeholders and investors expect to access reports on different platforms and require varying levels of detail. FTSE100 packaging manufacturer Mondi addressed this by launching a digital report in 2019, which allowed users to click through to different pages to access more information.

Businesses must move away from a tick box approach to reporting.

In summary

  1. Annual reports are an opportunity to build reputational capital
  2. Narratives must be ‘active’ and set out a clear purpose and value
  3. Investors are an important audience but reports should be aimed at employees, customers and other stakeholders too
  4. Transparency builds trust. Trust builds resilience
  5. The rise of the ethical consumer requires businesses to be clear about their sustainability strategy

It is not what your report says about you. Ask, what is the value that your report can bring?

Contributors

Portraits_Circular_Abigail_Smith

Abigail Smith

Senior Account Manager

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