MEMBER CLINIC: Annual reports
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The thrust of the recent changes was to ensure the report reflects the tone and character of the board Q.
There has been a lot more focus recently on what
Q.
Is the move to integrated reporting being
good reporting looks like. Have companies responded in the
accompanied by signs of more integrated thinking?
spirit of the regulatory changes, or more with compliance?
A. Companies adopting this reporting model certainly
A. I believe that many companies followed
seem to be running their businesses in a more sustainable
the spirit of the regulatory changes and made a
and integrated way. And there are clear benefits to
concerted effort to improve their 2013 annual reports
doing so, including better connections across different
and accounts (ARAs). That said, both the extent of
functions within companies; a better understanding of
change and the lead time companies were given
supply chain risks, and improved operational efficiencies;
to adopt the changes meant that some had to limit
and business planning and decision making that are
their focus on compliance – understandably so.
focused on the creation of longer-term value.
So now there is an opportunity for companies to
But it will be some time yet before we know whether
reflect, look at how reporting practice has developed,
this new reporting model creates more sustainable
and use the guidance issued since the regulations
companies, or simply reflects practices and processes
were finalised to enhance their annual reports this
already embedded into sustainable companies.
year. Companies also have to understand what their shareholders want, and how to communicate this in an accessible and understandable manner. This process will be unique for each company – so it cannot be just a box-ticking exercise. The fundamental thrust of the recent changes was to ensure that the annual report of a company reflects the tone and character of the board, and the narrative they want to convey.
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It is time for reports to provide better insights on what the nomination committee has done BUSINES S VOICE | OCTOBER/NOVEMBER 2014
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