A tremendous opportunity now exists to make sense of non-financial reporting through a key proposal that came from the Department of Trade and Industry's review of company law, which became the subject of a Government White Paper and is expected to be in legislation in 2003.
The Government is proposing a new Operating and Financial Review (OFR). Its purpose will be to provide a discussion and analysis of the performance of a business and the main trends and factors underlying results and the financial position.
It is intended that the OFR be a qualitative, as well as a financial, evaluation of business performance, to include reporting on social, ethical, environmental and, importantly, reputational impacts. The Institute of Public Relations is now in the process of drafting guidelines and a model approach to the proposed OFR that we will launch to coincide with the legislative timetable.
Last month, the IPR commissioned MORI to research non-financial reporting among communications directors from FTSE companies. The vast majority (93 per cent) believe that it enhances corporate reputation and most see it as a practice that will increase.
The research also confirms that the trend towards increased non-financial reporting is driven at least partly by stakeholder expectation. And although more than three-quarters of respondents have heard of the OFR requirements, just 32 per cent claim to know a great deal or a fair amount about them.
I believe that this is a critical period in the development of a more mature and influential public relations profession and a tremendous opportunity for our discipline to consolidate and rationalise our role.
Join our new commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies