Almost 93 percent of businesses say integrated reporting breaks down barriers between teams and leads to better connected departments, according to a report by corporate communications agency Black Sun in association with the International Integrated Reporting Council (IIRC).
Understanding Transformation: Building the Business Case for Integrated Reporting tracks the behavioral changes during the first year of the IIRC’s pilot program initiative, which aims to help develop an International Integrated Reporting Framework.
The pilot program involves more than 80 private and public companies such as Volvo Group, Danone and Microsoft, and 25 institutional investors. Companies involved produce a periodic integrated report, about their organization’s strategy, sustainability initiatives, governance and financial performance and prospects.
Participating companies are trialing the framework to provide feedback. The Black Sun report provides a baseline for follow-up research that will track the companies’ progress.
Black Sun director of research & strategy Sallie Pilot says the initial research findings support a business case for integrated reporting — and good reporting in general.
Key findings include:
- 98 percent agreed that the shift towards integrated reporting leads to a better understanding of how the organization will create value over time.
- 74 percent agreed that it will lead to more consistency in external communications.
- 93 percent agreed that it leads to better quality data collection.
- 64 percent say analysts will benefit significantly from integrated reporting in future.
- 95 percent say employees will benefit from it in the future.
- 28 percent report they are already seeing significant benefit to the board from integrated reporting and 56 percent expect to see significant benefit to the board in future.
- 97 percent expect a positive benefit overall to the board in the future.
Ernst & Young last week published a report that discusses the benefits and challenges of integrated reporting and outlines four initial steps companies should take to implement the reporting practice.
FSinsight editor Jeroen Derwall, assistant professor at the Tilburg Center for Sustainability and at Maastricht University, calls integrated reporting “the next step” in sustainability reporting.