Integrated reporting is an essential framework for reporting how an organisation creates value in the short, medium, and long term. It is first and foremost about integrated thinking, an approach to decision-making that considers the relationships and linkages between the various functional units and capitals used and affected by an organisation.
It is no coincidence that the International Integrated Reporting Framework (IIRF) is now part of the International Sustainability Standards Board (ISSB). This merger will enable organisations to tell a more connected story of how they create value over time by drawing connections between non-financial issues affecting an organisation and the related impact on the organisation's financial fortunes or future viability.
As more organisations embrace integrated reporting to simplify their corporate reporting by leveraging information from other reports, they must understand the steps they should consider.
One primary step is to build the capacity of the internal teams across the organisation to ensure a shared and consistent understanding of the reporting requirements of the framework, the principles and content elements.
Organisations then need to set their reporting ambition, with clear goals for each year regarding the improvements and changes required to move from their traditional reporting to a matured integrated reporting level. Once the reporting goal for the year is set, then the data gathering and analysis should commence.
This process typically involves various internal teams and data owners, including information from other reports. The data process for integrated reporting should include systems and tools for real-time data gathering, analysis and monitoring to ensure a smooth business-as-usual integration.
Organisations should focus on measuring and reporting outcomes and impacts, the value created for their stakeholders and the sustainability of their resources and capitals into the future.
Once this information is prepared and assured (internally or externally through an independent audit), organisations should use infographics and suitable presentation styles and formatting to tell their story.
A good report should show a connected picture of strategy, business model, capital, outcomes, risks, material matters and stakeholder engagement. It should communicate concisely and effectively how the organisation has created value in a balanced way.
