Approach to reporting A s increasing regulatory obligations and stakeholder expectations mean more extensive demands on corporate reporting, companies face the challenge of ensuring that their communications do not become overwhelming and cumbersome, but instead remain effective in offering a holistic picture of their business. To combat the more extensive information which they are required to produce, companies are looking at how best to use the print and online channels to satisfy the expectations of various stakeholder groups. Overall, the leading reporters engage with their audience by providing meaningful, interesting information in a logical structure. This year we have seen a steady improvement in the Annual Report becoming more accessible and readable, both in print and online. Five-year trend analysis Quality of reporting Time • Reports continue to increase in length, though accessibility and presentation of information has, in most cases, improved accordingly. • Number of online reports is relatively stagnant though companies are beginning to innovate to enhance the user experience. Leading reporters: • Focus on quality rather than quantity using good information design to make the content accessible. • Tailor their reporting strategy to suit the needs of their stakeholders. • Use the online environment to give users a choice in terms of how they access and view information about the company. What’s required? E-communications provisions of the Companies Act 2006 are now well embedded into the reporting regime of most listed companies and the majority are continuing to upgrade their online reporting to meet the demands of ‘defaulted’ shareholders. Additionally, the published HM Treasury ‘Plan for Growth’ discussed the need for quoted companies to ‘materially simplify narrative reporting’, thereby encouraging companies to explore the different channels available, such as the website, to best present core and additional information on their business. The recommendation that ‘companies should take advantage of technological developments’, by the FRC, and its proposal that ‘companies be relieved of the burden of producing a printed Annual Report’ has been controversial. Upon reading the letters printed in the Financial Times on the subject, it would appear that the FRC is perhaps a few years too early with their recommendation. However, as the next generation who will become the users of Annual Reports are almost exclusively consuming information in a digital format, the likelihood of reports being demanded through online disclosures is high. www.blacksunplc.com © Black Sun Plc 2011 31
