Trust Across America-Trust Around the World™

Earlier today Jordan Kimmel interviewed Bob Eccles on Trust Across America radio. The archived interview will be available in the next 48 hours.

www.voiceamerica.com/voiceamerica/vshow.aspx?sid=1713

Robert G. Eccles first joined the faculty of Harvard Business School in 1979. After receiving tenure, he started doing research on corporate reporting, a topic which remains of great interest to him from a research, managerial practice, and public policy perspective. His book  One Report: Integrated Reporting for a Sustainable Strategy (with Michael P. Krzus) is the first book on this subject. This is the Amazon link.

www.amazon.com/dp/0470587512 tag=trustacrossam20&camp=213381&creative=390973&linkCode=as4&creativeASIN=0470587512&adid=1AM99F52MSMW1MTA2CMV&

Bob is a member of the Steering Committee of the International Integrated Reporting Committee (www.integratedreporting.org).

Jordan and Bob spent the hour talking about Integrated Reporting and why it is so timely. Highlights from the interview are reproduced below.

What is integrated reporting?

It is a single report produced by a company that combines material financial and nonfinancial data into one document.

Why is integrated reporting gaining in popularity?

Bob highlighted four main reasons:

1. Technology has made it easier for companies to share information with their stakeholders via their website.

2. Sustainability is becoming more mainstream.

3. The recent financial crisis has prompted companies to provide their stakeholders with added transparency.

4.  Companies are becoming more aware of the importance of corporate repuation as an intangible asset.

Who benefits from integrated reporting?

1. Employees

2. Customers

3. NGO’s

4. Investors

5. Society

What are the key challenges in implementing an integrated report?

1. Companies must gather information from many different (and often independent) silos within the organization.

2. Internal measurements of nonfinancial reporting are not well developed.

3. Companies are not always willing to be, or comfortable in being, more transparent.

4. CEO”s must embrace the integrated reporting concept.

5. A lack of clear integrated reporting standards makes auditing difficult.

But the good news is that, over the next year, there will be more examples of public companies issuing integrated reports and more groups will be developing standards and frameworks.

In mid-October a workshop entitled “Workshop on Integrated Reporting: Framework & Next Steps” was held at HBS and sponsored by their Business and Environmental Initiative. This culminated in the release this week of a new e-book on integrated reporting, reflecting the input and efforts of 64 workshop attendees. The Landscape of Integrated Reporting: Reflections and Next Steps is now available at the following link:

www.smashwords.com/books/view/30930

In summary, the development of corporate integrated reporting (IR) standards is potentially one of the great business innovations of the 21st century, and could be pivotal in restoring public trust in business institutions. We are all stakeholders in some way, whether as employees, customers, or investors. As such, we can all play a role in encouraging companies to adopt IR into their culture.

Professor Eccles can be reached for comment at reccles@hbs.edu

or you can direct questions and comments to:

 barbara@trustacrossamerica.com

Thank you Professor Eccles and Jordan! Happy Thanksgiving to all.

Barbara Kimmel, Executive Director, Trust Across America

Any parent who has sat on the sidelines of a boy’s high school soccer game knows that the referee “controls” both the technical and behavioral components of the game. Sometimes the “calls” are accurate, sometimes not so much. But what happens when the referee fails to show up?

That scenario played out earlier this week in a game between two teams- one a big inner city group, and the other “smaller in stature” suburban group.

From the sideline parent’s perspective, it looked like trouble. Who could imagine these two groups facing off on a field with no referee? But since it was an “add on” to the schedule, and didn’t “count”, it was decided that the game would be played anyway.

The parent’s and coaches held their collective breath as the game began, and for the next hour, we waited for the “trouble” to start. It never did. Not only was there no trouble, but the two teams got along better than most. There was good sportsmanship and the boys were talking and laughing with each other during the game. The game ended in a 2-1 victory for the urban team, the boys shook hands, some “high-fived”,  and we all went home.

What is the moral of this story? The person in charge has the power, makes the “obvious” calls and shoulders the blame for conflict. When there is no person in charge, the obvious calls are mutually agreed on, and the not so obvious are talked out. This is a clear demonstration of the “roundtable effect” (a meeting of peers), in that nobody is above or below each other, and good decisions are easy to come by.

What are your thoughts? Drop me an email at barbara@trustacrossamerica.com