The Coloplast Experiment

Here is one of my favorite examples of the value of greater transparency around intangibles.

This experiment was performed by PriceWaterhouseCoopers’ (PwC) Corporate Reporting practice a number of years ago. It used involved creating two versions of an annual report of Coloplast, a Danish company recognized as a  leader in corporate reporting.

• The first was an original version of the Coloplast annual report. In addition to the normal information in an average annual report (financial statements, narrative, and a few key metrics), this report included extensive  quantified non-financial indicators to make a clear link between its strategy and its financial performance.
• The second version of the annual report stripped out the quantified non-financial data. The stripped-down report was still richer in detail than the annual reports provided by most companies in the market. But the  critical non-financial metrics were missing.

Two groups of analysts reviewed the different reports. The conclusions were striking.  Read more

A New Approach to Annual Reports

I recently happened upon an interesting site that I somehow hadn’t found until now called Report Leadership.

It was a joint effort last year by the Chartered Institute of Management Accountants (CIMA), the Corporate Reporting group at PriceWaterhouseCoopers, and the design firm Radley Yeldar.

The group took it upon themselves to build a new annual report. The site explains their thought process and includes a sample web-based annual report for a fictitious company.

Having been a consumer of annual reports since my early career as a high risk lender, I can tell you Read more