SAS has recently launched the third of our biannual research studies in conjunction with Thomson Reuters, providing a unique perspective on global institutional investors’ needs and preferences with regard to corporate reporting. Adrian Parker reveals a taster of the insights the study provides to help you shape your corporate reporting strategies.
Based on conversations with 50 global buy-side and sell-side investment professionals, our report examines their attitudes to report formats, content, design and communication channels, including usage of online tools both now and in the future. here are just a few interesting trends from over the four years we've been conducting this survey:
1. The effects of the last wave of legislation is slowing
In general terms since 2006 there have been major changes to the way that FTSE companies present information in their annual reports. In recent times the market has recognised this improvement. However, it seems that momentum is waning. This year we noted that only 3% of analysts and investors thought that reporting had 'improved considerably' over the last two years compared to 28% in 2010.
2. Mixed feedback on transparency
Our findings highlighted a perceived small improvement in companies' disclosure in key areas such as 'growth drivers' and risk. On the other hand there was no perceived increase in transparency with regard to strategy and objectives, including corresponding KPIs. As in 2010 peer comparison was seen to be the weakest area in terms of transparency.
3. Technology is changing the landscape
Apps are still the least used channel compared to traditional print and online report formats but the fact that they appear at all is significant. Our view is watch this space. The same trend can be seen in the use of social media too with only around 1 in 10 analysts using it to engage with companies. Adoption is rising slowly for numerous reasons but again, watch this space.
4. Integrated reporting will change the world - possibly
Much has been written about the notion of integrated reporting in the last couple of years with the International Integrated Reporting Committee now coming to the end of the first of a two year pilot programme. However it seems that no one yet has bothered to engage with the target audience for integrated reporting - the investment community. Our findings revealed a combination of audience indifference and ignorance with over 70% of investors unsure what integrated reporting is the difference it will make.
To request a meeting to share the full findings please contact Elizabeth Gordon.
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