Integrated reporting, the system for connecting all of the strands of an organisation’s reporting, has now moved from ‘headlines to trendlines’, according to Paul Druckman in the interview, by which he means that the shock of the new has become something much more mainstream. 

It is not just about the uptake and publication of reports, he says, it is now also about how integrated reporting has a place on government and business agendas around the world. It has become a settled and largely accepted business system and is also bringing about changes at the macro level. ‘The fact that it is in so many countries and so broadly understood and acknowledged is remarkable’, he says. 

But there is much still to do. The quantity of reports being published may be impressive, but often the quality lags behind. Many reports, as Druckman readily admits, are a combination of other reports with an integrated reporting tag holding it all together, or simply, as he puts it ‘a story being told well’. The future is about patience and letting integrated reporting, as it expands its reach around the world, bed down. He is also keen to do it differently. The corporate temptation to simply pull together the old systems and declare it to be integrated reporting is still strong. 

That needs, he says, to be challenged. And people need to be very wary of slipping back into old ways. ‘We need to be very careful not to use the techniques of the old system and just duplicate them’, he says. ‘We have to be very careful of that when we think about integrated reporting and a new system of corporate reporting’. 

A new training initiative will help. In the year ahead what is called a training competency matrix will be rolled out within corporates and by outside organisations. This should, he feels, boost quality and it will also focus companies on looking for outcomes rather than just at the content. 

And this will continue to ensure that companies and other organisations move ever further away from a silo mentality. This will gradually happen as people look for purpose as well as performance. ‘If you are looking at purpose as well as performance’, he says, ‘you can’t have silos’. It is about releasing people from what he refers to as ‘the shackles’ by explaining more rather than simply measuring. ‘People need to get together and work it out’, he says. Now the view is that while financial reporting is essential it is only one piece of the whole. And he thinks that change in attitude has been a fundamental shift over the last couple of years and integrated reporting has been a significant factor in it. ‘It is’, he says, ‘changing the way that everyone looks at corporate reporting’. It is a different thought process. 

Druckman emphasises the growth and reach of integrated reporting around the world, from Japan to Africa and from the Netherlands to China. ‘Some of the best integrated reports you will see are in Japan’, he says. And he extols the virtues of the stewardship code in Japan. But the overall message globally is one of steady growth and understanding. In the UK, he says, the strategic report used by companies is very much aligned with integrated reporting. And to strengthen the advance of integrated reporting in the US they are to create a US group that Druckman thinks will help significantly. And amongst the recent changes to the new board overseeing the IIRC the chief executive of the AICPA has come on board. 

Ultimately it needs to be fired up by investor demand. And Druckman sees a significant change here with markets now expecting investors to behave more, as he puts it, as shareholders rather than simply as traders. And academic evidence is starting to come through which shows that where companies had a higher integrated reporting score they also had a lower cost of capital and a higher intrinsic value. 

The story of integrated reporting still has a way to go. Druckman and his team have hopes that it is building into the successful, transformational, connected system that they have long advocated.