the impact of integrated reporting - ifac › system › files › meetings › files › 4 graham...
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THE IMPACT OF INTEGRATED REPORTING
IFAC ANNUAL SEMINAR – A FUNDAMENTAL SHIFT IN CORPORATE REPORTING
Presented by Graham Terry Senior Executive: Strategy and Thought Leadership
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Components of Market Value
8368
3220 19
1732
6880 81
1975 1985 1995 2005 2009
S&P 500Physical and financial assets Other assets
Source: Towards integrated reporting - Communicating Value in the 21st Century – International Integrated Reporting Council
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Increasing length and complexity
Source: Investis research - PwC
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“Corporate reporting … has got too big, too cumbersome and incomprehensible …”
Source: Tomorrow’s Corporate Reporting : A Critical System at Risk –CIMA and PwC
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South Africa
King III
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Integrated Reporting Framework
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Integrated Reporting combines the most material elements of information currently reported in separate reporting strands - (financial, management commentary, governance and remuneration, and sustainability) in a coherent whole, and importantly:
What is integrated reporting?
International Integrated Reporting Council Discussion Paper
• shows the connectivity between them; and
• explains how they affect the ability of an organization to create and sustain value in the short, medium and long term.
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Integrated Thinking
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Research & awards
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Some trends
Wait and see approachShorter reports betterRecognition of other stakeholdersExplaining business modelImproved financial reportingLinkage to sustainabilityImproved disclosure around value added and resources consumedImproved disclosure on risks
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IRC Research
78% of companies used the term Annual Integrated Report
Conducted by - College of Accounting, University of Cape Town
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IRC ResearchConducted by - College of Accounting, University of Cape Town
60% of Boards endorse Integrated Reports
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IRC ResearchConducted by - College of Accounting, University of Cape Town
57% of reports - to be read by stakeholders other than investors
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IRC ResearchConducted by - College of Accounting, University of Cape Town
17% shorter than 100 pages
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International Position
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International Integrated Reporting Council
UNEP FIAcademicsFinancial Stability BoardWorld BankInternational Organisation of Securities CommissionsGovernment representativesWWWFUNCTAD
Accountancy profession Global Reporting InitiativeGlobal CompactIASB/FASBGlobal CompaniesWBCSDTransparency InternationalStock exchanges
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Pilot programme
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Examples Database
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Assurance improves credibility of Report
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Thank You