Study of integrated reporting also shows benefit to analyst relations and improved data quality
Ninety-two percent of people who use integrated reporting as part of a three-year program say it has increased their understanding of how value is created and destroyed, while a large majority of survey respondents say data quality and long-term decision making also benefit, according to a new study.
The research, conducted by the International Integrated Reporting Council (IIRC) and communications firm Black Sun, shows that 84 percent believe they have benefited from improved data quality, 68 percent say they have developed a better understanding of business risks and opportunities and 65 percent see a benefit to their long-term decision making.
Participants in a three-year IIRC pilot program designed to test and research the International Integrated Reporting Framework were surveyed for this study. The program includes 140 prominent businesses such as HSBC and Marks & Spencer, as well as institutional investors from 26 countries.
More than half (52 percent) of those surveyed who have published at least one report using integrated reporting say they have experienced better relations with analysts and 56 percent say they have seen a benefit in their relations with institutional investors.
‘I’m delighted to see the journey to better reporting is having significant impact on changing mind-sets, information sources and decision-making processes,’ says Sallie Pilot, director of research and strategy at Black Sun, in a press release. ‘This leads to improved internal and external engagement and – ultimately – better business decisions.’
The study also shows that 71 percent of participants see a current benefit to the ability of their boards of directors to focus on longer-term success, while 87 percent say integrated reporting ensures investors can better understand their companies’ strategies.
About 90 percent who have published an integrated report add that they have seen a moderate to significant improvement in internal engagement. Among those who are still working toward their first integrated report, 44 percent note a moderate to significant impact on internal engagement.
