Integrated reporting: issues and implications for reporters

This paper examines the issues involved in integrated reporting, i.e. reporting that meets the needs of both statutory financial reporting and sustainability reporting, and their implications for reporting organisations. The paper assess the benefits, challenges and driving forces.

The authors founds that there does not yet appear to be a significant external demand for integrated reporting with the main drivers likely to be internal:

• the challenge for staff
• improved understanding of the links between sustainability and business strategy
• consistent messaging
• improved decision making

Of the external factors considered:

• regulation was regarded as a weak driver, although financial disclosure requirements are evolving to take account of a broader range of risks which could include sustainability.
• the assurance market was also found not to be driving integration and could actually be a barrier because of the fear that becoming associated with non-financial information could affect accountants’ willingness to audit integrated reports or even the financial statements within them
• new technologies were thought more likely to drive integrated reporting, than integrated reports; there is a gradual move away from printed reports and the same technological drivers at work on financial reporting will affect sustainability reporting.

The biggest challenge seemed to be the sheer volume of information to manage within tight timelines, especially for reporters who had not previously produced a sustainability report.