Integrated reporting framework sets out stall on clarity and simplicity

An international framework for integrated reporting that will see firms providing more comprehensive, long-term and user-friendly information has been proposed.

The International Integrated Reporting Committee (IIRC) has put its long-awaited discussion paper Towards Integrated Reporting out for public consultation from companies, stakeholders and report producers.

Announcing that “the world has changed – reporting must too”, the paper proposes that information on issues like “long-term viability” and the connections between hitherto separately-treated business areas are placed at the forefront of the new reporting regime.

The IIRC – a group of high-profile corporate, investment, and civil society CSR professionals – also sets out its stall for a simplified reporting format. It says the “clutter” that has built up from increasingly detailed and sophisticated financial and sustainability reports “needs to be removed”.

According to the document, the framework’s core objective “is to guide organisations on communicating the broad set of information needed by investors and other stakeholders to assess [their] long-term prospects in a clear, concise, connected and comparable format.”

The move follows the Global Reporting Initiative’s new sustainability reporting guidelines, announced earlier this summer (EP13, issue 2, p12), which were intended to be a stepping stone for companies preparing for the IIRC framework. The framework itself is intended to be used alongside financial and sustainability reporting standards.

Sir Michael Peat, chairman of the IIRC, said, “We need an approach to reporting that is fit-for-purpose in the 21st century. The world has changed – reporting must too.

“All matters which are important in assessing an organisation’s performance and position, past and prospective, need to be reported but not by making annual reports ever longer and more complex – they are too long already. The information needs to be provided clearly and concisely with the connections between financial, environmental and social impacts demonstrated and the clutter removed. This is what integrated reporting seeks to achieve.”

The deadline for responses to the paper is 14 December. A pilot programme will be announced shortly after.