The integrated reporting process can kick-start integrated thinking, by bringing people from across the organisation together through the reporting cycle. At the same time, for organisations to obtain the full benefits, the reports need to communicate this to investors and other external stakeholders.

This report looks at three key ways in which integrated thinking is communicated in the annual integrated report:

  1. clear communication of strategy
  2. pertinent discussions about non-financial value drivers that form the basis of the multi-capitals model, and 
  3. consistency between the narrative report and the financial statements.

ACCA reviewed fourteen 2019/2020 integrated reports of companies in the IIRC’s <IR> Business Network. Our reviews and interviews with some of these companies revealed:

  • Divided views about the purpose of an integrated report, with nearly half of the companies positioning their integrated reports as sustainability reports
  • Strategy and strategic goals are not always communicated coherently: reporting on governance, business model and outlook are often divorced from strategy, and lack consideration of future horizons
  • Despite the increased focus on sustainability, sustainability objectives are not yet fully connected to the overarching corporate strategy
  • Multi-capitals thinking is yet to take root: at present, key value drivers are not discussed consistently through integrated reports, and this may indicate that there is not yet consensus across the business about what the key value drivers are
  • The integrated report is not always consistent or connected with the financial statements, and vice versa: impairments recorded in the financial statements are almost never referenced in integrated reports.

Throughout the report, we provide best practice examples and highlight practical tips to guide more organisations on the path to integrated thinking and integrated reporting.


2022 will be an Olympic test for reporting. In the throes of the global pandemic, investors and other stakeholders will expect to see changes to risk and opportunities, strategies and business models in integrated reports.

It is particularly likely that the outlook sections of reports will be keenly read by investors and others. In these conditions, authenticity and transparency will be rewarded rather than punished.

Top 10 practice tips

  1. Collaborate, from the start: Plan the report with a cross-functional team, with teams from across the organisation working together.
  2. Tone from the top: Active steering and oversight from a forward-looking board that is willing to learn and embed integrated reporting and thinking across the organisation.
  3. Materiality process as a management tool: Use the materiality process to focus on risks and opportunities that have the most impact on value creation, and develop strategy accordingly.
  4. Stakeholders and purpose: Understand how each key stakeholder group enables your organisation to fulfil its purpose, and consider their legitimate needs and interests when developing strategy.
  5. Focus on strategic goals: Identify a core set of long-term strategic objectives,
    develop rolling targets, and report on these consistently from year to year.
  6. Connect strategies: Understand and articulate how topic-specific strategies
    and operational plans work together to support core strategic goals.
  7. Break out of the template: Think consciously about how your unique business model supports the achievement of strategic goals, and make this link clear in the report.
  8. Adapt the model: Know which capitals and components of capitals really matter to the achievement of your organisation’s purpose and strategy and ability to create value, and report on them in terms that make sense to internal and external stakeholders.
  9. Show why you care: Clearly explain the value of different ncapitals to your organisation.
  10. Work at the connections: Put in place active mechanisms to ensure that the integrated report is consistent with the financial statements – in the numbers, the events and transactions reflected, and in its underlying assumptions.

Download the report here.

Source: ACCA