New Integrated Reporting Framework introduces meaningful new features
Yesterday, the International Integrated Reporting Council (IIRC) published the first revisions to the <IR> Framework since it was first published in 2013. This has been the culmination of two years work and...
yesterday, the international integrated reporting council (iirc) published the first revisions to the <ir> framework since it was first published in 2013. this has been the culmination of two years work and extensive consultation with 1470 individuals, including yours truly, in 55 jurisdictions.
the most fascinating outcome has been how fit for purpose the original framework was. given the passage of time, the light touch that resulted is remarkable. and good news because we don’t have to learn yet another change in our way of reporting.
the changes that have been made are really more about making things clearer and more actionable than anything else. all aimed to make the quality of reporting better. a couple of the tweaks really move the ‘integrated thinking’ and ‘reporting’ aspects forward a notch.
there were 22 issues that the consultation uncovered and that have been addressed. and only seven of these are ‘significant’.
the most pertinent of these for most of us are the changes to the value creation model (vcm). and this relates to distinguishing clearly between outputs and outcomes. most global reports have conflated these, probably because of confusion. have a look at the new version of the diagram:
in particular, let’s hone in on the business model component:
the first points that the changes make a lot clearer:
- outputs and outcomes are very different concepts. and both are important because it’s the outcomes that actually impact on value
- while outputs can directly affect outcomes, so can your business activities. they revised diagram conveys this
the second point to note:
- the diagram now reminds reporters that outcomes should be considered not just in the short term, but also in the medium and long term
the third point to note:
- it now reinforces the need for balanced disclosures. this speaks to the quality, credibility and integrity of reporting information. this means acknowledging and candidly communicating some areas in which value is eroded or simply preserved rather than just created. and declaring negative outcomes along with the positive.
this can often be about trade-offs between the capitals, e.g. by increasing profits or providing improved customer benefits, you may perhaps create adverse outcomes for the environment or society.
integrated reporting has always encouraged us to disclose the lows as well as the highs. now the investment market globally is demanding it for their quality assessments. the revised framework now really spells that out clearly. the end-game benefit to reporters is that quality and transparency of information leads to better capital allocation and lowers the cost of capital.
beyond the vcm, there are two more areas where the global market requested greater clarity.
- qualitative and quantitative information. the framework now reminds reporters that disclosures are most effective when they have a blend of narrative and metric indicators – the indicators providing the support or evidence and a basis for comparison while the narrative provides the all-important explanation and context.
- simplifying the statement of responsibility. a bit of a technical change, but the purpose is to lower the reporting burden while not sacrificing the quality of the report. it recognises that integrated reporting is a multi-year journey and that perfection is not achieved in year one. so it lowers the responsibility on directors in particular in terms of what their sign off promises.
the future of integrated reporting is clear
there is no doubt that integrated reporting has now reached global tipping point. the principles are now visible in almost every report we see, even if they’re not purporting to be integrated reports. in particular, the notions of reporting on the things that really impact the business and its stakeholders (materiality), of value creation, of short, medium and long term planning, of the importance of non-financial information, and of connecting that non-financial information to the fortunes and health of the business – they’re obvious in every report now. and that’s a direct legacy of integrated reporting. and given the global feedback on the <ir> framework and the very few changes resulting, it’s a way of thinking that we can say, with confidence now, has stood the test of time.
click here to see the full new <ir> framework.
The Sanford Integrated Report Journey
It seems that wherever we turn in corporate New Zealand, the Sanford integrated reports are held in the highest esteem and the benchmark that other companies measure their integrated reporting progress by. We...
it seems that wherever we turn in corporate new zealand, the sanford integrated reports are held in the highest esteem and the benchmark that other companies measure their integrated reporting progress by.
we have produced all seven of the sanford reports, starting in 2014. (and prior to that, their annual and sustainability reports since 2008.)
the 2014 report was a breakthrough. it really set a high threshold for what integrated reporting could and should be and put corporate new zealand on notice for what future reporting expectations would be.
it’s a great time to look back at the journey. sanford’s ceo for the past seven years, volker kuntzch, elected to seek a change of direction. this retrospective is as much a tribute to his visionary and care-centred leadership as it is a tale of the evolution of sustainability reporting in new zealand.
the early reports
when volker briefed us to produce the 2014 report as an integrated one, we had little experience in the genre. we knew some rudimentary principles and looked at two or three australian examples, but to be frank, were completely underwhelmed and felt they taught us nothing.
it was time to take a deeper dive to really understand the crux of this new way of thinking. the penny-dropping moment was when the ceo of the iirc (international integrated reporting council) visited new zealand. he encouraged us to stop looking through the lens of the impact that sanford had on things, and start thinking about how those things might impact on sanford’s business in the long term if not planned for and protected. once we looked beyond the one-way corporate citizenship thing, we were able to see the virtuous circle and what a game changer this was for business and the world.
sanford proved to be the perfect client to apply this to. the most immediate and lasting impression of hearing volker’s philosophy was the authenticity that was being nurtured within sanford – his genuine care for people and the environment in particular. you could feel the soul of the company under his leadership, and that sense has continued, only today there’s a lot more embedded structure around it. and that philosophy will, in turn, protect the sanford business for decades to come.
from the beginning, we knew that soulful storytelling was the key to sharing this authenticity. so rather than merely report data about what they were doing, we chose to dig deeper and frame a more emotive, connecting story.
our first report was titled ‘how we see the sea’. and it set the tone for the new way they deserved to be perceived.
we continued storytelling journey in 2015, seeking once again to convey the grounded authenticity we found in sanford, and embed that understanding. with reports that are content heavy, as these reports are – close on 120 pages – we strive to layer the communication, so that the core tone and messaging are conveyed at a glance, while those that want evidence have plenty to provide that assurance.
2016 – 2020
as we all gained more experience in integrated reporting, our learnings enabled our reports to become more sophisticated and the messaging more specific while never veering far from that intrepid seafaring core.
the value creation model journey
a great measure of increasing understanding of integrated reporting is the sophistication and depth of one of the central and defining elements: the value creation model.
back in 2014, our understanding of what they were meant to convey was fairly superficial and the resulting first attempt, while clear, was very simplistic.
in 2015, we made it more engaging through illustration, and it is this version that seems to have set the benchmark if imitation is indeed the sincerest form of flattery. we now see versions of this illustration in many new zealand integrated reports.
as for sanford, they’ve evolved too. as they’ve become more meaningful with the gradual inclusion of more data, the space for illustration has become somewhat constrained. but we’ve endeavoured to retain the visual engagement while ringing the changes to keep it fresh.
openness and trust
ironically, one of the aims of integrated reporting is conciseness. but when one of your communication objectives is transparency and clear differentiation within an industry that suffers from a corporate trust issue, then full, open disclosure and over-communication is a valuable positioning tool. as sanford has seen success in this defining positioning strategy and trust rapidly build, they have been able to reduce the page count noticeably in the last two years. but openness and transparency have never been compromised.
awards speak to an enduring quality
sanford have been recognised every year of their integrated report journey. over a dozen international awards, from the new york-based arc awards to the international graphis awards to the more regional ara awards, thrice winning best integrated report, twice winning best sustainability report, and twice being a report of the year finalist. and this year, the inaugural nz integrated reporting award winner.
as the years have gone by, our immersive knowledge of both the spirit and mechanisms of the integrated reporting framework have grown exponentially. but the dive into the deep end for sanford was the trigger that sparked our admiration for the extraordinary business power of integrating reporting and our desire to go deeper and deeper to better advise new zealand businesses no matter where they are on the journey.integrated reporting, annual reports, sustainability reports, sanford, insight creative, value creation models
Integrated Reporting Principles - Alignment in storytelling
There are a number of reasons why ‘alignment’ is a good word to keep in mind when planning your corporate reporting – and integrated reporting in particular. This eight minute video spells them out, and goes on...
there are a number of reasons why ‘alignment’ is a good word to keep in mind when planning your corporate reporting – and integrated reporting in particular. this eight minute video spells them out, and goes on to tell you where to look to find some alignment to inform your report narrative.
with practical, real-world examples of how these principles have been applied to reports for companies such as nz post, vector and watercare, the hope is that these few minutes will help you approach your next report with a road map, a bit more clarity, and a toolkit for telling a cohesive story to your various stakeholder groups.
we wrap up with a bit of planning theory: how to map out your document structure logically, and to closely reflect your company's vision, mission, values and strategic plan.
Our 5-Year Rollcall of ARA Winners
Every year when the ARA Awards (Australasian Reporting Awards) are announced, we quietly congratulate each other, knock together a social media post and move on to the pressing projects of the day. But this year,...
every year when the ara awards (australasian reporting awards) are announced, we quietly congratulate each other, knock together a social media post and move on to the pressing projects of the day.
but this year, having won the communication award for both private and public sectors, the sustainability report of the year, and being finalists for the report of the year and the best integrated report, we decided we should actually take a closer look at our track record over the last 5 years. and even we were impressed with ourselves!
but of course, we can’t take all the credit. it takes a village. and our clients have to have the right intent, headspace, passion, and develop the right content for us to work with. so we take joint pleasure in compiling the following list of ara achievements – and being the common denominator.
nz super fund
if nothing else, the list is testament to the faith these clients have put in us over so many years. we are so grateful for your continuing loyalty.
ara awards, annual report awards, insight creative
Integrated Reporting Insights – The connectivity principle
This video in our series on integrated reporting looks at the guiding principle of ‘Connectivity of Information’. This is the bit where <IR> asks you to join the dots between the various things that are...
this video in our series on integrated reporting looks at the guiding principle of ‘connectivity of information’.
this is the bit where <ir> asks you to join the dots between the various things that are happening because looking at things in silos isn’t particularly useful. it’s systems thinking really, where there are interdependencies whether they’re immediately obvious or not. if you can clearly see the trade-offs, you can understand how they affect each other. and that might have you making different decisions.
so how do you go about identifying these connections? and then how do you articulate them in your report?
this video provides a couple of tips . . .
Integrated Reporting Insights - How important is hard data?
This video in our series on integrated reporting takes a look at the roles of qualitative vs quantitative information. We often come across clients who know they need to embrace Integrated Reporting but feel...
this video in our series on integrated reporting takes a look at the roles of qualitative vs quantitative information.
we often come across clients who know they need to embrace integrated reporting but feel they’re not ready to go there because of a lack of hard data. our response to that is two-fold:
- starting on the journey towards integrated reporting is more important than producing the ideal report. this is not a game you can master overnight. just get started with a report that has the right spirit and improve over time.
- hard data is only part of the story. your genuine stories and exposing the soul of your beliefs in action are just as important. the <ir> framework spells this out: “the ability of the organization to create value can best be reported on through a combination of quantitative and qualitative information".
so, if your organisation has a conscious intent, and is deliberately dealing with activities that affect your people, your product and the planet in a cohesive way, you can definitely start on the integrated reporting journey. it will be the quality and genuineness of your thinking and actions that will set the scene in your early reports.
in the accompanying video, i show you how effective this can be.
Integrated Reporting Insights - the Value Creation Model
In this, the first of our video series on aspects of integrated reporting, we take an in-depth look at the Value Creation model. Value Creation (or depletion, as the case may be) is probably the most fundamental core...
in this, the first of our video series on aspects of integrated reporting, we take an in-depth look at the value creation model.
value creation (or depletion, as the case may be) is probably the most fundamental core principle of integrated reporting – the ability of an organisation to create value for itself and other stakeholders and society over time.
and the value creation model is the flow diagram in virtually every integrated report that illustrates how a company’s operations adds value to the various financial and non-financial capitals that it utilises.
as companies globally are adding more and more information into their value creation models, insight creative’s mike tisdall is observing them drowning in so much complexity that they’re ceasing to communicate effectively.
this video is for viewers who already have a reasonable understanding of the principles of the value creation model and are ready to dig deeper into the nuances. it takes a brief overview of the anatomy of the vcm, as outlined by the <ir> framework, and then focuses on some of the components that routinely cause confusion or get overlooked.
we take a close look at the important difference between outputs and outcomes; the role of risks, external operating environment, the company’s strategy, and how much detail the business model itself should attempt to incorporate.
and we pose the questions: how much is too much? and what’s more important – content or reader engagement?
Integrated Reporting: Connectivity of Information
It’s one of the core principles of an Integrated Report (<IR>). But many clients seem to think it’s one of the hardest. We’ll get to that in a minute – but spoiler alert: it isn’t really. First,...
it’s one of the core principles of an integrated report (<ir>). but many clients seem to think it’s one of the hardest. we’ll get to that in a minute – but spoiler alert: it isn’t really.
first, let’s consider why the <ir> framework considers it an important principle. basically, it’s because it’s really not that useful to look at material issues in isolation. there are interdependencies there whether you’ve noticed them consciously or not. and if you can surface these connections and the trade-offs between issues, it becomes easier to understand just how they affect each other. which in turn influences decision-making.
and here’s that easy way to get started that i alluded to above: in my experience, even if an organisation hasn’t been through a formal integrated thinking process, threads naturally occur and it’s just a matter of using fresh eyes to look at the tapestry to find the sometimes not-so-obvious synergies. because – credit to your leadership - there’s usually a strategy at play and you can join the dots if you look closely enough.
and while this isn’t as good as being crisply intentional in strategy activation, at least it gives you a place to start if you’re embarking on an integrated reporting journey in an organisation that hasn’t yet got a level of maturity in its integrated thinking.
most annual reports contain some form of case studies these days. they’re used to illustrate a strategy in action and provide proof points for directional statements. analyse your case studies. you may be surprised at how many of them tick more than one of your strategy boxes, and impact more than one of your stakeholder groups or desired outcomes.
once you’ve identified them, surface them and actively join the dots. explain how the examples deliver on your strategies or help you towards a stated kpi goal. different case studies can deliver to different goals of course, but you will probably find that some actually deliver to more than one.
here are a couple of examples from watercare and vector which illustrate how we’ve actively helped the reader connect case studies to more than one of the business’s goals and strategies.
note how each of these case studies reports back to watercare’s stated strategic goals (highlighted by the red boxes):
so, look closely at your in-market activities. you may be surprised that they meet more than just commercial objectives. and take another look at your stories about your people, the environment and the community – you may well find that each meets more than one of your stated strategies.
having got to this point, you can now start to be more intentional in your non-financial planning, goal setting and kpi measurements. before you know it, integrated thinking will be happening in your organisation.integrated reporting, connectivity, joining the dots, non-financial reporting
What will improve integrated reporting?
For those companies seeing the benefit of structuring their annual report along ‘integrated reporting’ lines, the latest move by the International Integrated Reporting Council (IIRC) is interesting. The...
for those companies seeing the benefit of structuring their annual report along ‘integrated reporting’ lines, the latest move by the international integrated reporting council (iirc) is interesting.
the <ir> framework was published eight years ago. and it has stood the test of time so well that it hasn’t been updated in that time, despite constant reviews. but that’s about to change.
there’s no doubt that reporting systems have evolved since then, along with perceptions of what businesses should be doing and saying. there is some strong consensus now around the importance of capitals beyond the purely financial. as a result, most companies can see the wisdom of the thinking behind integrated reporting. within this context, <ir> has solidified its role in changing the way companies think, plan and communicate their value creation.
the revisons being mooted in no way conflict with the intent and philsophy inherent from the beginning. and by ‘mooted’ i really mean three key themes around which market feedback is being sought. as lisa french, the iirc’s chief technical officer, has said:
“the iirc has learned a great deal from the application of the <ir> framework by around 2,000 businesses in over 70 countries. while the feedback is that the <ir> framework is a robust tool that has stood the test of time, our <ir> business network participants and others in the corporate reporting system have been clear about where they believe minor modifications and clarifications will enhance the effectiveness of the <ir> framework.”
if you’ve ever grappled with a value-creation business model, or struggled with the difference between outputs and outcomes, for example, then your views will be valuable.
have a read of the questions and submit your answers here.iirc, integrated report,
Interim Reports – the unintended consequences
So, listed companies no longer need to publish an Interim Report. Great: less work, less cost. But if that means you’re communicating with your retail shareholders and other stakeholders at only 12 month intervals,...
so, listed companies no longer need to publish an interim report. great: less work, less cost.
but if that means you’re communicating with your retail shareholders and other stakeholders at only 12 month intervals, then houston, i think we have a problem.
how big the problem is depends a bit on your share register: instos vs retail shareholders. you’re no doubt talking to your institutional shareholders regularly – they’re probably making sure you are. but for retail shareholders, a year’s gulf can be very wide. absence probably does the very opposite of making the heart grow fonder.
radio silence equates to ‘don’t really care’. it disengages. it risks halting loyalty. they may not back you when you suddenly need their support. or they may not hold their shares.
it can lead to ignorance - your shareholders not keeping up with the exciting things you’re doing. and if they don’t keep up, the share price may not either.
if those are the unintended consequence of dropping the interim report, what can be done to mitigate the downsides?
find another way to talk to them mid year or more often . . .
keep the communication lines open in one way or another: keep sending the interim report is one option. but others include sending the report without financials. or a newsletter. or a newsy magazine. and those are the physical ways if you don’t care for trees that much.
but an email newsletter is probably your best avenue. that way you can communicate to all selected stakeholders, not just shareholders. and you get to talk to all your shareholders, not just those very few who have opted in to receive your report in the past. an email newsletter can engage pretty well if it’s crafted by someone who knows about messaging and design. the trick is to get your headline messages across in the email directly, and provide secondary and support messages with links to fuller stories on your website for those whose curiosity you’ve managed to pique.
can’t really do the above without a quality email database of course, so you may need to negotiate hard with your share registry to obtain what you need. or they may offer to organise the mailing for you. but in that case, i strongly recommend you take strict control of the messaging, design and html building rather than leave it to them . . . horses for courses.interim reports, investor communication, stakeholder communication
Integrated Reporting: Don’t aim for perfection. Just get in the mood and go.
I see too many clients hesitating to get on the integrated reporting bus. Often because they perceive that there’s a lot of internal change needing to happen before this is possible. Sometimes it’s because...
i see too many clients hesitating to get on the integrated reporting bus. often because they perceive that there’s a lot of internal change needing to happen before this is possible. sometimes it’s because they’re waiting for leadership and board to make such a far-reaching decision. but equally often it’s because they don’t know quite where to start. this article is designed to help you conquer all of the above and get started on the journey anyway.
certainly, if the aim is for a fully-fledged, assurance-quality integrated report, then a lot of ducks need to be lined up, and the board needs to make an active and mindful decision.
but here’s the thing: the <ir> report is not an absolute. so you don’t need to tick all their boxes to get started. even if you use the framework as it is intended – as a framework – to guide your approach, you’ll be on the bus. personally, i spent too long thinking of the <ir> principles as ‘must haves’ in total. i’ve since learnt that while this comprehensiveness is an end-game goal, it’s the ‘notion’ that has the most power. and the iirc (international integrated reporting council) themselves will applaud you for just starting on the journey, because they know you’ll only get better from there, over time.
i have <ir> clients that don’t call their report an integrated report but are starting to apply some of the core principles to their approach. they know that when they grow up they want to be a ‘real’ integrated report. but they also know that this is a game that you can’t master overnight.
so think about starting the integrated reporting journey as <ir> on trainer wheels. perhaps you can’t yet join all the dots between the various action streams to cross-credit cause and effect. perhaps you haven’t quite got the board across the line yet. but those things aren’t a barrier to applying the integrated reporting lens to your report.
so, where to start
the following are very subjective views on what principles you should include in order to start on the journey. a purist may well disagree – after all there are a whole 19 requirements in the <ir> framework, and some are more onerous than others. but what’s important here is the spirit - and in the spirit of ‘extended external reporting’ and using some the framework ideas in <ir>, here’s where i’d be thinking:
- tell the story of how you create value over time. this shows you understand your business drivers, how your business model makes money and has the right impacts on people and planet. if you do that right, the story should be unique, separating your company from others you’re competing with – for capital, for talent, for distribution, for consumers.
- purpose beyond profit. as soon as you start thinking about the impacts you’re having beyond money-making, somehow the ground shifts and you start thinking differently about business. the really strange thing is that the research shows that companies that think more broadly and apply systems thinking to their entire operation, end up making more money and lowering their cost of capital. go figure, but the facts speak for themselves.
- risk. being aware of future, potential, latent risk is the first step towards resilience to it. that’s making your business sustainable. and that’s my definition of ‘sustainability’. whether that’s competition risk, supply chain risk, talent risk, climate change risk – if you’ve got a plan to mitigate it, you’re more likely to survive. your capital providers, talent pool, suppliers and consumers tend to like survival.
- future focus. closely linked with risk, but also looping in opportunities, looking ahead and having clear strategies to optimise on both provides comfort and trust.
- strategy. lay out your core plan. what activations are you planning to achieve your purpose, mitigate risk, minimise harm, assure future sustainability, meet your stakeholders most important needs, and make the desired profit. belief equals trust.
- materiality. i have a far too simplistic view of materiality, i acknowledge. but where possible, i like to keep things simple. the big benefit of knowing what your stakeholders hold as most important means that you can focus your strategic plan around those – and here’s the free set of steak knives: you only need to report on those, keeping your report concise.
- connectivity. now we start to get a bit more woolly, and some things you do over there may be hard to prove affect what happens over here. but others are much easier to connect. if sanford don’t look after the ocean environment and fish stocks, for example, they may have trouble with their product volumes in a few years with kick-on risks in talent acquisition and regulatory controls among other fatal problems. so where you can show multiple impacts on your business strategy from a particular stance, initiative or policy, join the dots in your report.
- frank and balanced. openness and transparency is what’s expected now, whether it’s an integrated report or not. the whole notion of ‘extended external reporting’ is to build trust in the organisation through disclosure and transparency.
if you believe you can tell a story around most of the above eight points, then you’re well on your way to being able produce a report that’s in the right spirit. over the years, your company’s thinking will mature, the performance data will become available, your thinking and reporting will become more sophisticated, and one day you may feel comfortable to label your report an integrated report.
don’t wait until you can tick all 19 boxes before you start. use the <ir> framework as a principles touchstone and to shift your mindset, and get going at whatever level is right for your company.integrated reporting, getting started on integrated reporting,
Sticking to your annual report timetable
I’ve just spent two full days with about 20 annual report preparers on an integrated reporting training course. In amongst the learning and sharing experiences about preparing content for integrated reports, it...
i’ve just spent two full days with about 20 annual report preparers on an integrated reporting training course.
in amongst the learning and sharing experiences about preparing content for integrated reports, it became very clear that the internal process of herding the various cats within the organisation who are responsible for their own pieces of content can be a harrowing experience.
as annual report producers, we feel it hugely when clients don’t meet the contract that is the agreed timetable. currently we have 15 annual reports progressing their way through our artwork studio, and managing the logistics of typesetting and design turnarounds and checking all the changes accurately is an enormous challenge at the best of times. but when the client is late with their content – and more than one coincides in that regard – the pressure goes on us to catch the timetable up, and that’s usually physically impossible (although we always try our damnedest!).
"it became very clear that the internal process of herding the various cats within the organisation can be a harrowing experience."
and so i couldn’t help but have empathy with the individuals on the course. their task is a thankless one, often. and their demands on others in their organisation are often dismissed as less important than their own work and thus ignored. and because these contributors are often many levels senior to the poor content co-ordinator, the imbalance of power plays out very visibly.
occasionally companies will even outsource this co-ordination – and often writing – to a short-term internal or external contractor. well, if an internal employee has no clout, then you can imagine how well demands from some hired help is accepted (or not!). one attendee even told me of last year’s contractor whose contract wasn’t renewed this year because his efforts to deliver to the timeline were not taken at all well by those whose job it was to deliver content but failed to do so on time. and now the internal employee is being treated in much the same way. and this is from a major new zealand company who should, quite frankly, know better.
these projects are a massive undertaking for any organisation. but they’re not a voluntary exercise. companies don’t do this because they want to. they do it because they have to. and they need to do it to the best of their ability because so many critical people will form their views of the company – and make critical decisions on the company – as a result of the stories that are told, the future picture that is painted, the risks and opportunities that are highlighted, and the strategies that management are activating to achieve the company’s goals.
that’s no small thing.
so what’s required to grease the wheels for these projects?
first, leadership. the c-suite needs to send clear messages that the process is important to the business, important to the board, and set clear expectations that those contributing must meet their deadlines. often the target for this message is the members of the leadership team itself, so it falls to the ceo to make his requirements vividly clear.
second, the project co-ordinator. this role needs a loud and strong champion - his/her manager and department head. that manager also needs to set clear expectations and fiercely defend and support the project co-ordinator, taking the internal battles on personally if required to reset the tone. the project co-ordinator also needs a certain personality: dogged, persistent, strong, resilient, and yet always professional and polite. they also need the appropriate level of seniority and maturity to achieve the goals.
and finally, the internal process. there are a host of elements to be brought into play here. perhaps an initial meeting of all contributors where they are educated on the intricate and highly inter-dependent process, where domino effects can easily jeopardise the vital end delivery. perhaps a shared online project management system where every contributor’s role is mapped, tracked and monitored, and visibility is such that peers can see who’s letting the side down, whether it’s in content delivery or meeting their deadlines through the iteration and checking part of the process.
but in the end, it’s about the corporate culture. the working together. the seeing internal clients as ‘clients’ that need to be serviced just like external clients. and culture is established by the company’s senior leader.
it starts and ends right at the top.image: the japan times / roger dahl annual reports, timetable
The UN Sustainable Development Goals (UNSDGs) are great, so why are they making me feel uncomfortable? They set wonderful global targets to ‘ end poverty , protect the planet and ensure...
the un sustainable development goals (unsdgs) are great, so why are they making me feel uncomfortable? they set wonderful global targets to ‘end poverty, protect the planet and ensure prosperity for all’ over the next 15 years. they’re resonating with our clients and matching non-financial activities to sdg icons is a highly discernible trend in our recent annual reports.
and so nearly every integrated or sustainability report that we work on today includes a smattering of sdg icons.
in fact, almost every day i see evidence of an almost exponential ramping up of fervour about the sdgs. only last night i was at a seminar on charity fund-raising and one of the key strategies put forward by the speaker was the sdgs – in this instance by framing a funding application towards a company’s need to tick an sdg box or two.
"nearly every report that we work on today includes a smattering of sdg icons."
so, why do i feel uneasy?
perhaps it’s because i’ve been through the greenwashing era – a time of ‘band-wagon-jumping’ when some companies overstated their environmental credentials to be seen to be doing the right thing.
perhaps it’s because i get the sense that some companies are just being a tad too quick to jump on the sdg bandwagon. it’s actually pretty easy to ‘re-badge’ existing csr efforts to fit the sdg formula at a ‘lip service’ level.
perhaps it’s because i like the intent of the sdgs so much that i’m concerned about them being devalued by cavalier use.
but most of all, i think it’s because i believe that absolute authenticity and transparency works much more effectively than superficiality of badging. both because companies are rewarded for their honesty in the long term, and because in this age of social media, you'll be found out pretty quickly. the integrity of the use of the sdg icons comes when the depth of strategy and activity is genuinely driven towards improving the underlying goals in the lives of the people the company touches.
"i believe that absolute authenticity and transparency works much more effectively than superficiality of badging."
for me, the integrity test is to assess your strategies and operational initiatives against not just the name on the icon, but on the description that accompanies it. take ‘decent work and economic growth’ for example. does providing jobs and offering a wellness programme really ‘promote inclusive and sustainable economic growth, employment and decent work for all’ when roughly half the world’s population still lives on the equivalent of about us$2 a day? read the actual wording around this particular sdg here - particularly the goal 8 targets section part way down the page - and you’ll see what i mean. in reality, are you only taking credit for solving a first world part of the problem? are you addressing the goal right through your supply chain?
and that’s only one example. i encourage you to read the wording accompanying all 17 goals before you tack your colours to these particular masts. you might well find that your association with some of them is trite, trivial and verging on overstatement.
"let’s not play sdg bingo to see how many boxes we can tick."
let’s not play sdg bingo to see how many boxes we can tick. let’s be authentic in our sustainability activities and how we report on them.unsdgs, sdgs, sustainable development goals, corporate reporting, integrated reporting, sustainability reporting, csr
Storytelling for the Charities sector
The charity sector in New Zealand is facing new reporting standards with the gradual adoption of Statement of Service Performance (SSP) in addition to the traditional financial reporting. RSM New Zealand, an...
the charity sector in new zealand is facing new reporting standards with the gradual adoption of statement of service performance (ssp) in addition to the traditional financial reporting.
rsm new zealand, an accounting and audit firm with a leadership position in the not-for-profit sector, held a seminar in mid-september to coach management in the skills needed to meet the new requirements, report beyond financials, and optimise the telling of their story.
insight’s founder and strategist, mike tisdall, outlined some key tools to help these organisations structure their thinking, understand their audiences, plan perception shifts, and simplify and clarify their key messaging. using mainly corporate best practice examples, mike was able to show the audience how storytelling can reach out to both hearts and minds by capturing the soul of the organisation, painting the vision and supporting the big picture with facts and data to indicate progress towards the goals.
examples from the corporate world included mercury, vector, sanford, auckland airport and ravensdown. but insight has also been applying these storytelling principles to selected nfps for a number of years, and shared a series of award winning reports for stand children’s services (previously children’s health camps) to show how the principles can easily make the transition from corporates to charities.mike tisdall, storytelling, reporting, not-for-profits, charities sector, statements of service performance
5 Secret Sauce ingredients for an authentic annual report
Telling your story powerfully is central to brand strategy, and when Mercury rebranded last year, their annual report was one of the first vehicles off the rank. Now winning the accolade of ‘Best International Annual...
telling your story powerfully is central to brand strategy, and when mercury rebranded last year, their annual report was one of the first vehicles off the rank. now winning the accolade of ‘best international annual report’ in 2017’s global arc awards, the report reinforces our assertion that annual reports are one of a company’s most powerful brand positioning assets.
it is now the key lens we look through when discussing investor communications with clients - because the annual report has become so much more than an investor communication. one ceo briefed me last reporting season that he wanted his annual report to be his new 'international calling card' because he had such a new and different story to tell. we delivered that in august.
when this 'corporate repositioning' trickle trend started to turn into a rapidly flowing river lat year, i asked myself whether the annual report was the right vehicle for this task - wondering whether a corporate profile and website upgrade wasn't the more appropriate approach. and then i realised that the annual report is being seen as the 'ultimate corporate profile' - because it has the gravitas, the stamp of corporate authority, signed by the board itself to send the strongest possible signal that this is who we are.
in august we launched two other reports with perception-shifting goals. the first was for vector - a report that signficantly changes the game in terms of what business they're in. and the second was ravensdown's first integrated annual report - taking a highly authentic approach by lifting the shrouds and exposing their soul. another report that will shift people's perceptions of the company.
we first saw the power of this 'brand soul' expression in the first integrated report we produced for sanford in 2014. the respect for sanford accelerated rapidly over the weeks and months following publication. the perception needle shifted demonstrably and people looked once again at the company and saw it with fresh eyes that matched its fresh leadership. this report too went on to win many awards, locally and internationally.
so what's the secret sauce here that has made these reports really 'work' for the companies behind them?
- first, it's leadership. like all such things, it starts right at the top.
- second, it's authenticity. these companies don't try to pull any wool. they embrace the notions of corporate citizenship, shared value creation and 'doing the right thing' and have embedded these values deepy within their company cultures. it ain't ever lip service. it's genuine behaviours, their core belief systems, the way they naturally think. and more and more, it's about transparency - believing that honesty and openness will win out over any concerns about feeding strategies to competitors. they've come to realise that a competitor might be able to copy a strategy, but they can't copy the 'package' of authenticity that gives it true differentiation. the companies are simply organised this way, from the top down. and they hire the right people who think incredibly responsibly. at the end of the day, it's about 'trust'.
- third, the companies' strategies and visions are exceptionally well conceived and thoroughly thought through. they're elegant in their cohesion, with no hint of hedging bets, commercial dilution or dissonance.
- fourth, the visions, values and implementation strategies have utter clarity and are very simply articulated - internally (critically important) as well as externally.
- fifth, they work with us to clarify and amplify that articulation and adopt powerful storytelling techniques - both visual and voice.
we've shared our stories about vector, ravensdown and this year's mercury reports elsewhere on this website, but by way of explaining the above theories in practice, here's a little background about how we went about last year's mercury report that has just been judged last year's best international annual report by arc.
the 2016 annual report was the first major publication following their rebrand from mighty river power, expressing everything the new brand stands for. it set the tone for how they wanted to be perceived from that day forward.
because the brand shift from mighty river power to mercury was so visually striking, our challenge was to not spook investors about the change but to clearly show continuity while boldly illustrating everything had changed under the new brand. no easy ask.
we made the new brand the hero, unfolding the brand story over the opening three spreads. showcasing the visual identity and positioning the brand as a new expression of their ongoing customer-led business strategy was key.
a new strategy spread and business model diagram were introduced to tell the continuing investor story in a fresh way, more aligned with a more dynamic retail-led brand. magazine style case studies were used to showcase the brand story in action, highlighting how the core aspects of the brand manifest themselves every day in 'what matter most.'
see our full case study in our work sectionarc awards, best international annual report 2017, mercury 2016 annual report, insight creative
The Value of Reporting Bad News
Guest Columnist: Craig Fisher of RSM Hayes Audit "Funders want to see failure" This may initially seem like a strange statement from people who on behalf of their organisations have invested considerable...
"funders want to see failure"
this may initially seem like a strange statement from people who on behalf of their organisations have invested considerable sums of money with an express desire to achieve successful outcomes. and even more so when you learn and appreciate the very detailed assessment and due diligence processes that these particular funders undertake before making any decision to fund a charitable initiative.
hence the statement appeared worthy of pondering and some unpicking. the rationale behind my enlightened funder friends' statement is that theyare realists. by virtue of being human and part of the world we all get to "enjoy" a range of experiences every day. any experience is intrinsically valuable, and especially negative ones. but only as long as one is aware of it, and then able to objectively analyse it to seek to understand what happened and why. and then most importantly; to take some remedial, corrective, or different action in the future as a result.
we learn more from our mistakes than our successes
this is a life lesson well worth learning. we would all like a life where everything progressed smoothly and to plan. but sadly that is just not realistic. (or at least not in the world i and all the organisations i deal with live in!). mistakes or failures can often be painful, soul destroying experiences. as with most painful things it is generally human nature to do our utmost to avoid them. and this includes trying to not even think about them to avoid re-living the pain mentally. but such avoidance (and let's be honest; some of us have got very good through years of practice and experience at avoiding confronting painful things) is actually a lost opportunity.
our failures, mistakes and other challenges in life when things haven't gone to plan are actually a gift. if they haven't killed us and our organisations, then they represent a fantastic opportunity for learning.
modern start-ups and software development also provide useful learning with the concept of "fast failure". recognition that you are likely to need to try lots of different things before you succeed. hence, it is best you do this as quickly and inexpensively as possible.
how does all this apply to organisational reporting?
i've also been thinking about the value of reporting bad news in the context of the requirement for service performance reporting. this new requirement for registered charities in new zealand is already impacting tier 3 & 4 charities and will be impacting tier 1 & 2 in the not too distant future. the service performance reporting essentially requires them to report what they set out to achieve, and what they actually achieved.
when you consider that this reporting is intended to, and i believe will, become a key communication vehicle to stakeholders, there is a natural tendency to want to present one's organisation and its experiences in the best possible light. after all, who doesn’t like to get dressed up when they go out in public.
but have you ever read what you were expecting to be an informational report, whether it be from a corporate or a charitable organisation, that just read like a marketing or promotional tool? i'm sure you have and i am equally sure that your reaction to it was fairly similar to most people - our natural scepticism tends to kick in, and we often quickly discount the truth, or the value of the information.
for this reason one of the qualitative characteristic requirements for service performance reporting is "faithful representation". this is attained when information is complete, neutral, and free from material error. neutrality is the absence of bias. hence for service performance information to be neutral it needs to report on both favourable and unfavourable aspects of the entity's service performance in an unbiased manner.
so back to my enlightened funder friends; they are realists and hence they want to see the real story. they will not "mark organisations down" just because they show some bad news as well as the good - as long as it is clear that the organisation has got value from their negative lesson and hopefully can improve their future experiences as a result.
so don't be afraid of bad news. there is nothing wrong with it as long as it can be explained and contextualised, and the organisation can show what it has learned and hopefully will do differently as a result in future.
if you want to explore this topic further, the following link from a coffee chat with a be accessible team member and founding member of the fail club may assist you in further peeling the onion of failure:
learn more about craig fisher here. transparency, reputation, trust building, reporting, bad news
More international awards
At the Australasian Reporting Awards held in Melbourne on 21 June, two of Insight's clients were recognised for their successes. Sanford The 2016 Sanford Annual Report won the Integrated Reporting...
at the australasian reporting awards held in melbourne on 21 june, two of insight's clients were recognised for their successes.
the 2016 sanford annual report won the integrated reporting category and a gold award. it was also a finalist for both the sustainability reporting award, and the supreme report of the year.
here are a few of the judges’ comments:
“an excellent, well rounded application of the integrated reporting framework, with a good balance of narrative, tables, graphs and stories making the content reader friendly.” integrated report award
“for such a large complex organisation organisation, this report presents a picture of simplicity. the coverage of areas of material interest to sanford stakeholders is exemplary.” gold award
nz super fund
the 2016 nz superannuation fund annual report won a gold award and the public sector governance category. the supporting annual review microsite was also a finalist in the online reporting category. this repeats their success at the 2016 awards.
Massive success on the world stage
When Graphis recognises your work as world class and publishes it in their respected biennial book, you know you're doing quality work. And we've been there a few times before over our 40 years. But to see six of...
when graphis recognises your work as world class and publishes it in their respected biennial book, you know you're doing quality work. and we've been there a few times before over our 40 years.
but to see six of our projects in one book, with five golds and one silver - well, even we were feeling pretty good about what we come to work every day to do!
(with thanks to sanford, ebos, stand children's services and vital healthcare property trust for entrusting us with you communications).
graphic, annual reports, gold winner, insight creative
And we win again, and again, and again and again
NZ may not be doing too well in the Rio Olympics, but Insight is winning golds, slivers and bronzes where it really matters: the New York based international Annual Report Competition (ARC Awards). Gold: ...
nz may not be doing too well in the rio olympics, but insight is winning golds, slivers and bronzes where it really matters: the new york based international annual report competition (arc awards).
gold: sanford. the best combined annual and sustainability report in the world (they don’t have an integrated report category yet):
silver: nz super fund. with no gold awarded, it's still the best pension fund annual report in the world:
silver: stand children's services. the second best charitable organisation annual report in the world:
bronze: auckland international airport. the third best airport management annual report in the world:
this is effective design that is driven by the collective collaboration of our strategists and creative talents. you can read in depth case studies on the gold and silver winners here on this website. to help you find them easily, we've collected them together for you right here.
arc awards, design awards, annual reports
Awards, awards and more awards
Last week's Australasian Reporting Awards (ARA) resulted in massive success for every one of our clients who entered (all two of them!) But 100% success is still 100% success. And as Insight is the common denominator,...
last week's australasian reporting awards (ara) resulted in massive success for every one of our clients who entered (all two of them!) but 100% success is still 100% success. and as insight is the common denominator, let's draw this achievement to your attention.
nz super fund
not only did the 2015 nz super fund annual report receive a gold award (one of only four new zealand companies to receive a gold), it also won best of two categories in the special awards:
winner, governance reporting - public sector, and
winner, online reporting - public sector
and all this on top of last month's win as best annual report in the 2016 asia-pacific excellence awards
our sanford integrated report also made a big impact at the awards, also winning a gold award, and also taking out a total of three categories in the special awards:
winner, sustainability reporting award - private sector
winner, integrated reporting
winner, ara hong kong sustainability award
view our case study on this integrated report here.
congratulations too, to the only other new zealand company to win a special award: watercare services (sustainability reporting award - other).
ara awards, sanford, nz super, winners
Trends in Annual Reporting
We often get asked by our clients about what the trends are in annual reporting. Sometimes I wonder why, because most actually stay on their conservative paths. But some brave few follow through and strive to find...
we often get asked by our clients about what the trends are in annual reporting. sometimes i wonder why, because most actually stay on their conservative paths. but some brave few follow through and strive to find more effective ways to communicate with their shareholder base.
some of the trends currently playing out have actually been quietly influencing reporting for a few years now, but others are quite new a little more radical.
the greatest shift is that because the structural rules are now so few, it has become possible to approach every company’s report with a blank sheet of paper and create a unique plan that is bespoke to the company’s situation, needs and philosophies rather than the straightjacket of what most companies still sense that an annual report should be, based on historical tradition.
let’s whip through some of the more notable trends. and then, if you want to know more, you can download the more detailed white paper that explores each of these trends in more detail.
first principles: it's about the investor brand, at its core. the report is merely a component in a much bigger strategic year-long communication plan, which in turn should be designed as part of a longer-term investor brand plan. all annual reporting decisions should align back to this touchstone and not be made in isolation.
- anything goes. now that regulations no longer dictate a prescribed format, what each company does for their annual reporting depends on the company, its view of the world, its appetite for best practice communication, its register make-up, its size, what its peer group are doing - and most commonly, the proportion and influence of its retail shareholder base vs its institutional investor base. because the legal requirements really only apply to the financials and compliance components, the opportunity for communicators is to approach how they choose to tell their investment story in many different ways.
- integrated reporting (see in-depth blog lost on integrated reporting) is making traction and more new zealand companies are actively exploring this to some degree. it requires a major change in thinking. but transparent reporting of all material issues, and their future effect on the company's longer-term outlook, are factors that will grow in importance and become more and more expected, whether labeled as integrated reporting or not.
- storytelling continues to mark the best practice reports - the back stories, the human impact, the strategies, the emotional connection. but not all companies agree that this approach is appropriate to them.
- online is important, but there are many ways to skin that cat. but the important point to register is that online is a 'pull' channel: people have to make the effort to go there for it to be effective.
- the opt-in gap is a real one. the percentage of shareholders who opt in to receive a copy of the annual report averages around 10% of the shareholder base internationally. the company must decide whether the 'push' channel necessary to plug the 90% gap of unengaged shareholders is a viable one for them (i.e. a printed/mailed shareholder review/ annual report/ newsletter), or whether that investment doesn’t provide a meaningful return.
for a more detailed explanation of the above brief summaries, download the full white paper here.
Insight into Integrated Reporting
Insight into Integrated Reporting If you’re in the field of investor relations, the jungle drums have probably already informed you of the impending avalanche of ‘Integrated Reporting’ (referred to...
insight into integrated reporting
if you’re in the field of investor relations, the jungle drums have probably already informed you of the impending avalanche of ‘integrated reporting’ (referred to internationally as <ir>).
it’s early days, but because of the many listed clients we work with, we’re in a pretty good position to watch the trends play out and see where the patterns lie. in fact, we’ve now produced two integrated reports, for sanford.
because the subject is gaining some buzz, there’s every chance that if your ceo doesn’t raise the question, someone on your board will. the temperature was raised in the last couple of weeks by the visit and speaking rounds of paul druckman, the london-based ceo of iirc (the international integrated reporting council). paul spoke publicly at the university of auckland, a sustainable business council breakfast and met with influential government ministries. i also had the privilege of spending a couple of hours with peter privately.
paul druckman, ceo, international integrated reporting council
how quickly will we see local listed companies diving into producing fully-fledged integrated reports like sanford? it’s hard to tell, because of the mindset shift required, the amount of work to measure what the framework requires you to measure, and boards’ perceived liability over future-focused utterances on value creation.
just what is an integrated report?
the new <ir> framework urges companies to turn a spotlight on how their strategy and business model creates value over time.
companies are encouraged to tell a clear, concise story to investors about future prospects, taking into account all the resources and relationships used by the business, not just the financials. this way, investors and other stakeholders will be able to determine if the business model is resilient over the medium and long terms.
adopting a holistic approach to reporting expects you to report on the connectivity of all these resources, relationships and financials; for example, divining the non-financial impacts in $ terms in the medium and long term - a big challenge for most companies. in this regard, an integrated report differs materially from a siloed triple bottom line report. the <ir> evolution breakthrough comes when you can report on the interdependencies between them and the future likely affect on value.
fundamentally, it flips the question ‘what impacts does your business model make on such things as your people, your community and the environment?’ on its head: to answer the direct opposite question: ‘what impact will those factors have on your business in the short, medium and long term - and therefore, what are you doing now to mitigate or leverage them?’
is it good for business?
there is much to commend the <ir> framework.
the shift in thinking applied to how you communicate to your stakeholders will improve what you report, making it more meaningful, believable and future focused because it prompts companies to think about their reporting in a ‘joined up’ manner.
but perhaps the greatest benefit is that it drives board and management to look at their whole business through this much more integrated and holistic lens. they’re finding that this can lead to stronger cross-functional communications, more productive dialogue among employees at all levels across business activities, and more meaningful dialogue with external stakeholders.
those who think deeply about such things expect that the payoff for companies that do this right will be lower cost of capital.
how does it relate to sustainability reports?
while <ir> is principles-based and provides a good practice framework, sustainability reporting generally abides to the more rules-based and usually audited gri process.
elements of both financial reporting and sustainability reporting would be included in an integrated report if the information is relevant to how your organisation creates and sustains value. this would require assessing the connectivity and interdependencies between your business model, the context in which you operate, and the resources and relationships on which you rely and that you affect.
companies that are already collecting quality metrics on their environmental and people impacts for csr reports will find it easier to make the step up to integrated reporting because much of the data will be at hand to tell a connected story.
but a separate detailed sustainability report may still be required, depending on the degree of complexity involved in what you report on.
some companies, such as sanford, have decided that their integrated report should combine all factors and be a single source of transparent information.
what does it all mean for you?
the decision to pursue an integrated report is not for the faint hearted. it requires a major commitment for a total change in internal processes and business view to be meaningful.
it requires you to really work to identify what’s material to your business in terms of value creation over time. that means consulting stakeholders broadly to ascertain material issues, and having enough information and data to be able to talk clearly about the impacts that your operations have on all your inputs (financial, manufactured, intellectual, human, social, relationship, and natural).
it requires an 'integrated thinking' approach to your business before you can realistically report in an integrated way.
it requires a clear explanation of your business model, and how it adds to or subtracts from your various inputs to result in your various outputs.
it requires you to expose your strategies and the expected impacts that these will have on your future value creation. many boards find this challenging.
and it expects you to report on the interdependencies of all your activities, how they interact and how that interaction will affect your performance over time.
our sense is that certain types of companies/sectors will feel more need or pressure than others to move in this direction. companies with the highest sense of responsibility to think about their business in this way tend to come from those industry sectors that rely on or affect natural resources, such as energy companies, mining and resource companies, and food harvestors. however, the degree of difficulty in measuring, reporting and mitigating their impacts also means that the journey takes more time. in reality, we are seeing more integrated reporting activity coming from from entities with less environmental impact, and arguably more people/society impact, such as banks and property companies, probably because the material impacts are easier to identify and measure – or, more cynically perhaps, aren’t as sensitive to negative publicity from their disclosures.
many companies will simply find the process too challenging or will find it hard to find the roi given the lower material impact of their business activities.
but while the hurdles may constrain your ability to produce a bona fide integrated report, that’s not to say that you shouldn’t be reporting to your stakeholders about your responsible citizenship and how those initiatives are likely to affect your business in the future. and if you can demonstrate that the initiatives are good business practice that also increase revenue or save cost – or sustain your social licence to operate - then ‘win-win’ is a winning message anyway.
our sense of the immediate future
we’re not convinced that the current ‘hot topic’ buzz will turn into a wholesale shift to integrated reports in the short term. we believe that many will feel the pressure, explore the topic, discuss with their boards, and delay until it makes more sense for the organisation.
however, where there’s smoke there’s fire, and we believe that the thinking processes inherent in the <ir> framework will influence and infiltrate what you report – and over time, more components of the framework will be fulfilled.
want to know more?
we are always available to help and advise on your stakeholder communication needs. speak to your account director or call me direct on 09 919 6002.
this video inteview with paul druckman does a great job of outlining the principles and purpose of the movement towards integrated reporting.
the <ir> framework guidlines can be downloaded here.
insight creative founder and strategist
Yet more evidence of our effective work
Our 2015 NZ Super Fund Annual Report has been named winner of the Annual Report category in the Asia-Pacific Excellence Awards 2015. The Awards honour outstanding achievements in the fields of PR and...
It's raining Gold!
Insight has been awarded two Golds in the New-York based ARC Awards – considered the Oscars of the annual report world. World’s Best Airport Management annual report for 2014: Auckland International Airport (...
insight has been awarded two golds in the new-york based arc awards – considered the oscars of the annual report world.
world’s best airport management annual report for 2014:
auckland international airport (click for case study)
world’s best pension fund annual report for 2014:
nz super fund (click for case study)
the nz super fund report also won gold in the australasian reporting awards (ara awards).
naturally we're proud as punch of the respective teams that worked on these two projects, including our clients who enabled us to do such winning work!arc awards, awards, nz super fund, auckland international airport
Vista is the last of a hectic run of seven IPOs we've handled in the past 5 months. A massive push on quite an unprecedented amount of this kind of work saw this project finally come home. A full on and...
vista is the last of a hectic run of seven ipos we've handled in the past 5 months. a massive push on quite an unprecedented amount of this kind of work saw this project finally come home. a full on and effective visual document that is smaller than the average a4 finished size.ipo, vista entertainment group
Do you need an Investor Brand?
If you're a stock exchange listed company, investor perception of you as an investment is crucially important to encourage ownership, and help underpin share price. Well built, an Investor Brand can give your share...
if you're a stock exchange listed company, investor perception of you as an investment is crucially important to encourage ownership, and help underpin share price.
well built, an investor brand can give your share price resilience
an investor brand won’t stop the market panicking, but it should help investors make more informed and rational decisions about how they perceive your stock, and it should ensure that your stock is more resilient in the face of market panic.
what is a ‘brand’ anyway? and why does the concept apply to investment?
before we go any further, we should perhaps consider what a brand actually is, and why the notion applies to the ‘investor’ part of your business as well as the marketing side. a brand is more than a product, and more than a logo. one of our favourite definitions is: a brand is what people say about you after you’ve left the room.
so, it’s the set of value-associations linked to your name. in the case of marketers, that translates into higher margins. in the case of investors, it translates into stocks that are more accurately valued and that are more likely to be directly associated (by recall) with your strategies. investor brands carry a greater degree of familiarity for investors. people feel they understand them and where they’re going.
a strong brand creates space between you and other stocks competing for the investment
it differentiates the value of what your stock offers from that of your competitors. so it’s about your stock’s overall reputation and profile, and it’s about ensuring that your stock is chosen over another investment options in the same or another asset class. equally, when markets fall, it’s about having the information and awareness in the marketplace that minimises your downside.
to help achieve that, churchill pryce ir suggests that a robust investor brand needs to have associations and present messages to the market that are:
- comprehensive and