The International Integrated Reporting Council (IIRC) has published its annual integrated report, stressing that there is increased use of integrated reports detailing non-financial information
According to global research from EY, carried out for IIRC, 95% of respondents say integrated reports are either ‘essential’ or ‘very useful’, a substantial increase from 57% in the same study a year previously.
The IIRC singled out a number of countries as leading the way in the adoption of integrated reporting. They include the UK, where 35% of a sample of premium listed companies are ‘clearly considering the capitals in their business models’.
In France, 58% of the top 40 French listed companies (CAC 40) produced integrated reports, while in Australia, 48% of the 200 largest listed companies are leveraging at least some of the principles of integrated reporting.
The IIRC also points to Brazil, where there are now 700 participants in the Brazil integrated reporting network, and South Africa where 372 companies listed on the Johannesburg Stock Exchange are all required to produce an integrated report. In Japan, there were 342 self-declared integrated reports in 2017, while 100 listed companies in Malaysia prepared integrated reports in 2018.
This is the first IIRC annual integrated report to have obtained ‘limited’ assurance, with the IIRC board’ says reflects its determination to follow the principles the IIRC advocates. It says assurance is also an effective tool for ensuring the IIRC’s key stakeholders can have confidence in the IIRC’s value creation story.
The auditors reviewed the report to assess whether it had been prepared in line with the guiding principles of the international integrated reporting framework and to ensure it covered the key content elements. The auditor confirmed that the most significant data, statements and assertions within the report regarding the IIRC’s activities had been extracted appropriately from underlying documentation and appropriate external sources.
The IIRC say it will now work towards obtaining ‘reasonable’ assurance, where the auditor looks at whether the strategy, business model and performance presented in our integrated reports are an accurate reflection of how the IIRC operates.
The report evaluates progress the IIRC made in its mission to mainstream integrated reporting during 2018, as the IIRC moved from the ‘breakthrough phase’ to the ‘momentum phase’ of its strategy.
Barry Melancon, chair, IIRC board said: ‘The IIRC has long recognised the role assurance can play in building trust and confidence in integrated reports and this trend has been reflected by developments we are seeing in the market.
‘We believe the lessons we learned in obtaining assurance will help us in our conversations with businesses around the world that are also embarking on the journey to provide investor-grade information in their integrated reports.
‘During 2018, we initiated projects ranging from developing a model for strategy and integrated thinking to providing guidance on the role of technology in reporting. It is right that the IIRC as an organisation adopts the principles it advocates during these discussions and that is why I believe our 2018 integrated report represents a leap forward in our approach to reporting.’