We’ve blogged here about something called integrated reporting, which would merge financial reporting (which public corporations are already required to do) with sustainability reporting (which only some companies do).
What we’ve missed – until now – is the need to brand this transformation.
Integrated reporting is a transformation for a whole bunch of interrelated reasons. First, financial reporting is mandatory and highly regulated. All big companies have full-time staffs of people to prepare the reports, and the big accounting firms around the world have armies of people to check them. Governments have whole departments to check them again.
Sustainability reporting is at the other end of the spectrum, organizationally. It’s optional and unregulated, just like, um, PR. Even marketing has to be done with some level of honesty, but sustainability reporting is more like the Wild West: there’s no sheriff, and the posse hasn’t formed up yet.
So a lot of people in the corporate world are allergic to merging the two types of reporting. Even if they are already reporting about sustainability with some authenticity, they still want to keep the money and the social or environmental consequences far apart. Lush profits don’t look that good next to pictures of striking employees or mountains of tar coke.
If companies are not comfortable with baring their environmental and social performance, then doing so alongside financial information is a nightmare.
So far, the push for integrated reporting has come largely from academia and NGOs, and (surprise!) many of the arguments are tone-deaf. They’re clunky and slow to develop and full of long words with specialist definitions.
Kind of like the opposite of pheromones.
Pondering this, it suddenly hit me. The founders of integrated reporting forgot to brand the transformation. Does “integrated reporting” have the ring of “Arab Spring?” or “Velvet Revolution”? It does not. It just lays there, lifeless.
We don’t know yet what the right brand should be, but there are some clues out there already. For example, some companies with a purpose beyond profit are now talking about “combined reporting.” It’s only a change of one word, but it’s like magic when you talk to corporate executives.
They’ve been arguing with the academics about how expensive and complicated it will be to do “integrated” reporting. The academics often don’t know how hard it is to do good financial reporting all by itself, so that whole argument is going nowhere.
But when you talk with CFOs and controllers about “combined” reporting, the whole attitude changes. Companies combine things all the time. It’s not threatening, it’s simple. It’s even good, because you get, you know, synergies and leverage and stuff like that.
No need to tear up financial accounting rules or formats in order to “integrate” them with sustainability reporting. No need to spend tons of money on making sustainability reporting as comprehensive as financial reporting. Just start combining the two, as they are, and let the integration happen naturally.
So there must be a better brand for this concept, and those of us who believe corporations are best positioned to save the planet need to figure it out. Nothing would please us more than branding the transformation to help it happen.