What makes a ‘quality integrated report’?

Leigh Roberts

Over the ten years of integrated reporting in South Africa, I have been asked many times as to what makes a ‘quality integrated report’.

It is, for sure, the mindful adherence to the 19 requirements of the International <IR> Framework. It also stems from the organization’s intention of producing a meaningful and concise integrated report.

So, what is meaningful and concise? The Integrated Reporting Committee (IRC) of South Africa set about honing this broader term into targeted focus areas for preparers in its Delivering a Meaningful and Concise Integrated Report: An Information Paper (Paper) released in January 2021 and available at https://integratedreportingsa.org/a-meaningful-and-concise-integrated-report/ We ended up with six focus areas.

  1. Alignment: Optimize and align the reporting suite

In South Africa, our preparers like to apply “The octopus model” to their corporate reporting suite (for the IRC FAQ on this see https://integratedreportingsa.org/faq-the-octopus-model/).

It’s a sensible way of ordering and aligning all the legislative, regulatory, and stakeholder reports released by an organization. The integrated report is the “head”, and the other reports are the “arms”. The integrated report informs on the holistic story with the other reports focusing on subject-specific and more detailed information.

  1. Connectivity: Connect the information in the Content Elements

The integrated report should be a good read, rather than a weighty tome for insomniacs. It should have a logical structure and flow: this supports connected information, helps to avoid inconsistencies, and can limit duplication. A logical flow to the unfolding story in the integrated report could be. . . information on the organization and what it does; the external environment in which it operates; the business model; stakeholders’ needs and the responses (this shows the all-important feedback loop); the strategic objectives that direct the path ahead; the risks and opportunities; performance; and governance. (Outlook information is often given throughout the report and a summary thereof is a useful readability tool.)

  1. Conciseness: Balance conciseness and comprehensiveness

Achieving a concise report is an oft-cited bugbear of preparers. Our tips in the key considerations section in the Paper include: have a robust materiality process; be firm in only including relevant information; use the website and other reports to house detailed information; use considered infographics that give meaningful information; write in plain language and get straight to the point.

  1. KPIs: Explain KPIs and the link to value

Continually assess whether the disclosed KPIs actually reflect the value that is being created, preserved or eroded over time: are they relevant and used internally by the organization? Give the context to each KPI: what it measures, why it was selected, trends and industry benchmarks.

  1. Outcomes: Report clearly on outcomes and trade-offs

Good and complete disclosure of outcomes is essential to an integrated report. They are, after all, the “lasting effects” of the value process. Be brave about showing both the positive and negative outcomes on each of the six capitals. For a report that is biased to the positive can lead to questions over its completeness and credibility, and is there any organization today that can faithfully say it does not rely or affect each of the six capitals?

  1. Technical: Apply the International <IR> Framework’s requirements.

And with the governing body opining on whether or not the 19 requirements have been met in the integrated report. (Preparers new to adopting the <IR> Framework can use the “extent to which” leeway clause offered in the <IR> Framework (2021).)

Like most things in life, if something is not done meaningfully and with intention, it may not be worth much. www.integratedreportingsa.org


Leigh Roberts is the CEO of the Integrated Reporting Committee of South Africa and the Chair of its Technical Working Group. She is a member of the IIRC’s Framework Panel.

 This blog first appeared on the IIRC website in March 2021