The Bruce Column — The challenge of embedding integrated reporting in North American business

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Mar 27, 2017

Bob Laux has been a stalwart of the US financial reporting scene for a long time. Now he has taken up a new role, as North American Lead at the International Integrated Reporting Council. As he prepares for his task and the challenges "to ensure integrated reporting is at the heart of the business agenda in North America" he has been talking about his plans to Robert Bruce, our regular, resident, columnist.

Bob Laux is a financial reporting guru. A couple of years ago, at a panel event in Los Angeles he surprised everyone by saying he was "disgusted" at the state of the accounting profession. He was saying it for effect. But he needed to shout loudly to draw his audience’s attention to his view that financial reporting in the US had become a rolling mass of infrastructure, which didn’t really serve its users very well.

And when we talked recently, he talked about how "discouraged" he was by his profession, the accounting profession. "We are a great profession but we can do better", he said. "In the US we have periodic reporting, the 10Qs and 10Ks, and a tremendous amount of effort is put into those documents. There is a lot of infrastructure and controls on top of them. It is a huge infrastructure. It is rules. It is a lot of disclosure, documents which run to well over a hundred pages that I don’t think too many people are reading and may be not their first source for investing".

So how could he combat this massive obstacle? His answer is that "we are just going to have to be smart about it". And that, for Laux, means integrated reporting, reporting based on the different capitals which underpin value creation of a company. "We have been talking about this type of reporting for over two decades now. We have come a long way. But now is the time for action".

Read the entire column on our Global IAS Plus site.

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