The objective of the CSSA IR Awards, one of the longest-running awards for excellent reporting in Southern Africa, is to encourage innovation and excellence in integrated reporting. It is also extremely comprehensive comprising ten categories. The CSSA IR Awards are unique in that every entity is judged in comparison to its peers and has an opportunity to stand out in its respective peer-group.
Change in corporate reporting is an iterative process. The judges did not, therefore, go into this year’s awards expecting to see annual reports that were significantly different from those of prior years — and what they saw reflected that. If, however, we were to compare many organisations’ reports from five or more years ago to this year’s, there would certainly be many noticeable improvements. Nevertheless, we have to remind ourselves that South Africa has been at the forefront of integrated reporting since 2010. This compels us not to be complacent, but to keep challenging the maturity of our integrated reports.
We have identified four ongoing reporting challenges based on our reviews of integrated reports over the past few years and believe that maturity in reporting would be evident if entities get this right.
- Firstly, how entities are able to effectively use information management systems to make the most out of their internal management information;
- secondly, whether entities are preparing insightful reports that are distinctive and enabling stakeholders to distinguish one organisation from another;
- thirdly, restoring trust and ensuring authenticity of integrated reports through assurance and balanced reporting; and
- lastly, reporting on how executives are held accountable through appropriate governance structures and balanced performance indicators.
The Top 40 category was, once again, the most advanced category in the reporting journey. Most entities in this category have business models that are generally well articulated and visually presented in an easy-to-follow format. The truly advanced integrated thinkers in this category evidenced the fact that stakeholder engagement is an iterative process and not just a one-off communication. Some areas of improvement for this category would include the integration of governance into the rest of the integrated report and a clear and appropriate distinction between outputs and outcomes. The judges would also like to see more entities holding executives accountable by incorporating non-financial performance measures into executive remuneration.
The mid cap category, as with the Top 40 category, showed significant improvement in reporting on stakeholder relationships and engagement. Most of the reports in the small cap category evidence a good understanding of the International <IR> Framework. The state-owned companies were lagging behind the top reporters as reports appear siloed and still lack integration and balance. Overall, the fledgling/alt-x category has been a strong category with most companies disclosing the essential elements required in integrated reporting. In some cases, it was difficult to find fault with the integrated reports presented.
The regional category has been improving in its journey towards integrated reporting. There were excellent integrated reports in the unlisted company category. It is clear that the entrants understood what is required of effective integrated reporting: presenting detailed and thorough feedback on their operations, strategies and risks as well as board committee functions and mandates. The organisations in the not-for-profit category must be commended for making a concerted effort to achieve integrated thinking and, consequently, integrated reporting. The public sector category is strong in performance reporting and tends to report quite a lot of detail that is often very operationally oriented.
The full judges report has more detail on the various categories. We encourage reporting entities and prospective entrants to consider the recommendations to support them on the <IR> journey.
The judges and PwC as the convenor of judges congratulate all the winners in the respective categories and the overall winners, Nedbank Group Ltd. and look forward to seeing continued quality and improvements from next year’s awards process.
On behalf of the convenor of judges:
Ronel Fourie
Associate Director
Accounting Consulting Services
PwC
Jayne Mammat
Partner
Sustainability and Climate Change
PwC