Can Integrated Reporting Repair Trust in Business?
An article by Mark Graham, Associate Professor at the UCT Graduate School of Business, in Business Report this month highlights Integrated reporting (IR) as a powerful tool for building trust and confidence in companies – with a corresponding increase in company value.
Integrated Reporting is supposed to fill in the gaps in current reporting, providing a holistic picture of a business that takes into account all the six capitals a business uses to create value: financial, manufactured, intellectual, human, social, and natural. It’s a tool for building trust and transparency and giving investors a full picture of a business’s inter-related elements.
Currently South Africa and Brazil are the only two countries to make Integrated Reporting mandatory for listed companies, although the EU has issued a directive encouraging large listed companies to use IR and Japan is also putting IR policies in place.
Of course, for Integrated Reporting to be effective it needs to be easy for investors to access and understand – and that means making reports digital, searchable and comparable. As demand for comprehensive reporting grows, perhaps Integrated Reporting can help bridge the gap between the public and business.
Read Graham’s article here.