I was privileged to receive a preview (under the Chatham House Rule) of the proposed Integrated Reporting framework at a Business Leaders Forum hosted by Grant Thornton yesterday. Integrated reporting (or <IR> as I discovered) has the potential to become the "new normal" in terms of reporting company performance and prospects.
<IR> is an initiative aimed at improving how companies communicate with shareholders, stakeholders and the wider community. Essentially, <IR> is about moving from compliance-based reporting, to "a concise communication about how an organization’s strategy, governance, performance and prospects lead to the creation of value over the short, medium and long term" (direct quote from the IIRC website).
This business-led initiative was music to my ears. While I can work my way through a set of financial reports, I am no accountant. The trend in recent years towards longer, and more complex, reports has made understanding increasingly difficult. Any move towards a more straightforward explanation of performance (not to mention a more sustainable model of capitalism) can only be helpful.
The initiative has garnered the support of many global brands and investor groups scattered all around the globe. If you are a business leader (particularly a Board Chair, Finance Committee Chair, CEO or CFO), I recommend you take the time to familiarise yourself with the proposal, and make comment during the upcoming consultation period.
Thoughts on corporate governance, strategy and effective board practice; our place in the world; and, other things that catch my attention.